The news tells us that the pandemic played the main role in the general slowdown of the world, and consequently of the national economy, in a sort of ‘double taxation’ on the general accounts of the Country, to use a financial term.
The world slowed down, and Mozambique, overly dependent on the outside, felt the effects of this internally. As if this were not enough, the severe brake on key sectors such as tourism or industry has caused such a double impact, from inside to outside and from outside to inside, that penalises the national economy and its agents twice over.
The idea is not scientifically proven, to be sure, but it will be like the thermal sensation and the actual temperatures. The degrees are not right, but you can feel them on your skin.
Reading the 2020 Budget Execution Report we understand better why. The contribution of the mega-projects reached 20.2 billion meticais, corresponding to 8.6% of the total revenue collected, with a brutal 72.4% decrease compared to 2019, something that the report points out as “referring to the sectors of Oil Exploration and Mineral Resources which registered decreases of 87.0% and 5.6%, in nominal terms” compared to the same period last year.
The justification lies, in the non-accounting of capital gains that occurred in 2019 and, of course, in the reduction in the contribution of coal companies caused by the outbreak of covid-19.”
Whether it’s business, public relations or, who knows, a crisis of conscience: yesterday’s big polluters will be big investors for an ecological tomorrow. Confusing or not so much?
The example of Vale, which first stopped, like many other industries, to now announce its exit from the country, as a result of a global shift, shows a path that many of the world’s large companies began to follow some time ago. And a trend that the pandemic has only accelerated.
For years, coal’s days as a ‘dirty’ source of energy have been numbered, and its use has already been banned in many countries of the European Union, for example. But it only took months of covid-19 to bury it once and for all. China, India, South Africa and the US still use it to power factories, but Biden, now sitting in Trump’s seat, returned the points to the environment by watching for victory against coal.
Right next door in South Africa, where 90% of the energy produced comes from thermal power plants, the government last September approved the Low Emissions Development Strategy (LEDS) which it calls “the start of the journey towards a zero-emissions economy by 2050”.
And a response to the Paris Agreement for countries to establish long-term climate strategies that brings together a holistic approach to policy, planning and research across all productive sectors. But there are more examples, some that tell us a lot.
Total is also undergoing a conceptual transformation of its image and business. Not so much because of LNG, which is one of the least polluting among the fossil fuels and even well seen as an immediate or transitory alternative to crude oil.
Natural gas production will now account for 85% of total production. Good news for Mozambique here.
The French multinational thus wants, in the next decades, to reduce the impact of oil in its portfolio, increase that of LNG and diversify by resorting to renewables.
To this end, it has an investment plan of $500 million per year, about 3% of its total capital expenditure, to grow the low-carbon business and create a broader offer to cover gas, renewable energies, energy efficiency, clean fuels and capture technology, as well as photovoltaic and wind energy.
ENI, another well-known multinational giant of ours, unveiled in the middle of last year what has been hailed as one of the most ambitious climate promises made by an oil & gas ‘supermajor’: to reduce greenhouse gas emissions by 80% over the next three decades.
Then again, its natural gas production will now account for 85% of total production. Good news for Mozambique here.
And there will be dozens of other examples of companies that are seeing beyond the curve. It is debatable whether they are doing so for the pure and simple profitability of a new niche in which McKenzie estimates that 350 billion dollars will be invested so that by 2035 renewables, which today represent 4% of the total global energy source, will reach 12%.
Or whether it is just business, because the renewable cluster, based on the mining of rare materials, also has a dark side, different from the green side that they want to ‘sell’ us. The truth is that the great polluters of the last decades will be the great investors of an ecological tomorrow.
Confused? May the new normal not be ‘business as usual’ and may the Middle way not be just a means to achieve the old ends that brought us here.
