In December 2022, Radar Scape won an $800,000 contract to improve a 76-home resettlement village for people moved from their homes to give way to a Liquified Natural Gas project, in the Afungi peninsula, in the northern Mozambican province of Cabo Delgado.
The contract also envisages on-the-job training for Mozambican apprentices and is paid for by TotalEnergies, the French oil and gas giant.
Radar Scape is part of Rwandan companies and businesses that are flocking into northern Mozambique to cash in on Rwandan military and police presence in Cabo Delgado to help stymie the insurgency there – there is currently 3,800-strong Rwandan military and police contingent.
Mozambique’s Confederation of Business Associations (CTA) has been for a while advocating for the adoption of a local content approach on the awarding of lucrative contracts in Cabo Delgado.
Because most Mozambican companies vying for contracts with TotalEnergies would fall under the Small and Medium Enterprises (SMEs) category, they are graded Tier 3, meaning that they can bid for contracts up to $2.2 billion.
The Tier 3 pot seems crowded enough. In the past, before TotalEnergies declared force majeure and shut down operations in the Afungi peninsula, the CTA pressed upon TotalEnergies the need to award more Tier 3 contracts to Mozambican SMEs, especially since there was a perception that the oil and gas company was biased towards French and other international SMEs.
CTA Executive Director Eduardo Sengo told Mozambique Insights that “we’ve never reacted to Rwandan companies, but we’re concerned” with the new development.
Comment
Rwanda’s Paul Kagame has been claiming that he pays the tab for the continued presence of a 3,800-strong Rwandan military and police contingent in Cabo Delgado. However, Economics 101 will tell you that there is no such thing as a free lunch. So, Mozambique eventually ends up paying one way or another.
That’s how the influx of Rwandan companies, some, if not most, linked to Rwanda’s ruling party, into Mozambique, especially Cabo Delgado, has to be viewed. And it’s a no-brainer that Rwandan companies will be awarded contracts – Radar Scape was awarded a contract when officially TotalEnergies has yet to restart operations.
The logic consequence is that Mozambican SMEs are likely to lose out on lucrative contracts from TotalEnergies, as both Maputo and Kigali press the company to hand out even more contracts to quench Rwandan companies’ appetites.
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