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Rio suspends Mozambique coal exports on security fears

by Reuters
Wednesday, 26 June 2013 13:06 GMT

By Marina Lopes

MAPUTO, June 26 (Reuters) - Rio Tinto has suspended coal exports from Mozambique's northwest Tete province after the opposition Renamo party threatened to disrupt the Sena railway line that carries coal to port, a provincial official said.

Mozambique's economic revival is under threat as former guerrillas take up arms more than two decades after a civil war ended. Many say they have not benefited from the rush of oil and gas discoveries in recent years.

Sena is the only railway leading from the massive coal fields of Tete to the Indian Ocean port of Beira.

"As for Rio Tinto's goods trains, the company decided to suspend them," Rachid Gogo, Tete's provincial governor, told Radio Mozambique on Wednesday.

Rio officials in Maputo and Johannesburg declined to comment.

Brazilian rival Vale, which is investing $4 billion in coal mines near Tete and is the main user of the Sena line, said it continued to use the track, however, albeit with heightened security measures.

"We are alert, observing the events, avoiding unnecessary exposure in zones of potential conflict and interacting with other companies looking to obtain the best information possible," it said in a statement.

Renamo, a former guerrilla movement that waged a 1975-1992 civil war, has threatened to renew hostilities against the ruling Frelimo party this year in an attempt to wring political concessions out of the government.

Last week it made a public threat to disrupt major roads and the Sena line.

Since that announcement, gunmen have ambushed several trucks and buses on roads in Mozambique's central belt, killing at least two people and forcing vehicles to travel in convoys with military escorts.

So far there have been no reported attacks on the Sena line, a frequent target during the post-independence fighting between Frelimo and Renamo, which was formed with the help of white-ruled Rhodesia and apartheid South Africa as a bulwark against communism.

However, Mozambique media said passenger rail services on the line have been reduced. Foreign embassies have also advised tourists against all but essential travel in the central Sofala province, a Renamo stronghold during the war.

Analysts have said a slide back into the all-out conflict that crippled the former Portuguese colony in its initial days of independence is unlikely, not least because Renamo lacks the capacity for a sustained fight.

But Renamo can still wage a limited insurgency that could have big consequences and unnerve investors, given the country's limited infrastructure.

Our Standards: The Thomson Reuters Trust Principles.

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