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Finland to partly cease support for Forest Sector Support Program in Mozambique - Permanent Mission of Finland to the UN : Current Affairs : Ministry for Foreign Affairs News

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Press Releases, 10/29/2012 | Ministry for Foreign Affairs of Finland

Finland to partly cease support for Forest Sector Support Program in Mozambique

Press release 250/2012
29 October 2012

Ministry for Foreign Affairs has commissioned two special audits in the Finnish-funded support program for national forest sector in Mozambique. The Foreign Ministry has decided to cease support through the Ministry of Agriculture of Mozambique on account of irregularities in program activities. Finland will also postpone the planned cooperation to develop agriculture in Mozambique.

Minister for International Development Heidi Hautala, currently visiting Mozambique, has discussed the matter with Foreign Minister Oldemiro Balói and Minister for Agriculture Jose Condungua Pacheco. "The irregularities must be looked into to assess the basis of future cooperation. Cooperation is based on trust," said Minister Hautala.

The forest sector support program has funded forest investments, reforestation and investigation of land ownership conditions in Mozambique. The program budget for 2009-2014 is EUR 21.54 million, of which Finland covers EUR 11.44 million and Mozambique EUR 10.1 million. Finnish support includes technical assistance of a consulting company and funding of field operations through the general agricultural sector program of Mozambique. The program includes independent support mechanism by the Finnish Forest Research Institute, METLA, for climate change mitigation and adaption, which will continue.

Suspicions of malpractice came out in the spring of 2011. Therefore, Finland froze funding in June 2011 and run a special audit, which was reported in November and December 2011. The audits included the National Directorate of Lands and Forests of Mozambique and the activities in the provinces of Cabo Delgado, Niassa, Nampula and Zambézia. Sampling auditing was performed by KPMG. To follow the above audit, the Foreign Ministry commissioned another audit, implemented in April and May 2012. The audits revealed malpractice and deficiencies in accounting. The extent of malpractice and options for recovering the funds are currently under investigation. According to KPMG's estimate, hundreds of thousands of euros should be recovered from Mozambique.

Inspection and evaluation of activities are integral to project monitoring in the Foreign Ministry. The recently revealed irregularities are indicators of successful monitoring methods.

Further information:  Senior Auditor Sauli Heinimaa, Unit for Internal Audit and Evaluation, tel. +358 9 1605 5946

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Updated 10/29/2012

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