History
Mozambique has gone through five distinct periods, each shaped by foreign intervention:

LIBERATION WAR (1965-74): Portugal refused to follow the British or French models of decolonisation, and NATO backed Portugal’s attempt to retain its colonies. The Front for the Liberation of Mozambique (FRELIMO) was the unique liberation movement, and it gained support from both China and the Soviet Union, as well as left parties in Europe. Internal divisions led to several killings, including the assassination of the first president, Eduardo Mondlane, in 1969. A
Hanlon-Mosse: Is Mozambique’s elite moving from corruption to development?
shocked Frelimo then took to heart the quote attributed to Benjamin Franklin, the US revolutionary, that “we must all hang together, or, assuredly, we will all hang separately,” and has maintained a remarkable unity since. Samora Machel was elected president in 1970 and Frelimo began to make gains against the Portuguese. A coup in Portugal in 1974 led by a military tired of fighting colonial wars opened the way to independence the next year.
SOCIALISM (1975-81): With the coup, Portugal stopped the war and Frelimo, as the only liberation movement, took power. This was the era of the one-party developmental state in Africa, so there was no challenge to Frelimo merging party and state. Under Portuguese colonialism, government and the economy were dominated by Portuguese settlers, and the regime had been quite brutal, so the majority of fearful settlers fled back to Portugal. Social services (health, education, law, funerals) were nationalised but little in the economy. However many businesses were abandoned (and often sabotaged as the manger left), so the state, by default, ended up with a key and unexpected role in a mixed economy. Inexperienced and often poorly educated Mozambicans filled the gaps, and within two years had turned around administrative and economic collapse; the economy was growing and there was a rapid expansion of health and education. Increasingly influenced by, and supported by, the then Socialist East bloc, Frelimo adopted a socialist policy, with the state playing the leading role in a still mixed economy. Five years after independence, Frelimo remained immensely popular, both for ending colonial oppression and for the expansion of health and education.

1977 FRELIMO poster, announcing its 3rd Party Congress

WAR (1982-92): Ronald Reagan took office as President of the United States in 1981 and immediately intensified the cold war. Proxy hot wars between East and West took place in Angola, Mozambique and Nicaragua, and the US backed white minority rule (apartheid) in South Africa as a bastion against neighbouring “communist” states. An opposition guerrilla movement, Renamo2, was created. In an initially unsuccessful attempt to pacify the United States, Mozambique joined the World Bank and International Monetary Fund in 1984. The war escalated in 1986, with the killing of President Samora Machel3 and invasions of two northern provinces. As the war raged, Mozambique introduced a World Bank structural adjustment programme, which included a very large privatisation programme.

Peace was only possible with the end of the cold war, which brought the end of apartheid in South Africa. A peace accord was signed in 1992 which recognised the legitimacy of the government and the existing constitution, but ensured multi-party elections and made Renamo the only serious opposition party.
CAPITALISM AND THE WASHINGTON CONSENSUS (1993-2001): Renamo failed to displace Frelimo as the natural party of government. Joaquim Chissano, who had replaced Samora Machel, was elected president in multi-party elections in 1994 and 1999. Whereas the World Bank had dominated Mozambican economic policy in the late 1980s, the IMF came to prominence in 1990 and imposed an extremely harsh structural adjustment programme which included a limit on post-war reconstruction and limits on health and education spending. The economy had grown under the first adjustment programme, during the war, but declined in the post war period and there was no peace dividend. The IMF even capped the aid Mozambique could receive. But with its turn to the West and capitalism, Mozambique had become a donor darling. The donors rebelled in 1995; the IMF was forced to lift the cap on aid and the World Bank again regained dominance over economic policy in Mozambique. But the Bank and Fund agreed that Mozambique was too poor to afford universal primary education or increased health coverage, and this was not reversed until the introduction of the Millennium Development Goals.
This was the era of “savage capitalism” with the state forced to withdraw from the economy. There was widespread privatisation – small firms to members of the Frelimo elite and larger firms to foreign companies – and rapidly growing corruption. Joaquim Chissano nearly lost the 1999 election4 and Frelimo was shocked to find that the vote against Chissano was largely due to complaints about corruption and what was seen by the voters as the lack of Frelimo commitment to undertake anti-corruption measures. Two major privatised banks were looted, and two people investigating the frauds were assassinated; President Chissano’s son was eventually charged with involvement in one of the murders.5 Meanwhile, although loosening the IMF cap led to economic growth in 1996-8, the economy declined again in 1999-2001 and poverty increased, raising questions about Washington Consensus economic policies. Taken together, these brought the era of donor-promoted freebooting capitalism to an end.
PRODUCTIVE ELITE CAPITALISM (2002- ): Under the constitution, Chissano could stand one more time for the presidency, but Frelimo realised that his image was so tarnished that he would
Hanlon-Mosse: Is Mozambique’s elite moving from corruption to development?
lose. So the party selected Armando Guebuza as its new leader, and he won the 2004 election with 64% of the vote. (A mark of Frelimo’s unity is that Chissano remained inside the party and is still an important political force.) Even as it fell out of fashion elsewhere, donors in Mozambique retained their commitment to the neo-liberal, Washington Consensus policies. But very quietly (so as not to frighten the horses) the Mozambican elite began to direct state resources into productive investment. Guebuza strengthened, broadened and decentralised the party, while retaining quite tight central control. And a serious crackdown on some corruption began.
The implications of this current period are the subject of the rest of this paper.

Original Source:

Is Mozambique’s elite moving
from corruption to development?
By Joseph Hanlon and Marcelo Mosse

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