Mozambique's President Samora Machel has set his sights on the rapid transformation of this former Portuguese colony into Africa's first authentic Marxist-Leninist state, but a critical economic situation is slowing his progress.
While his government has just lurched sharply to the left in its ideology, it is proceeding at the same time with caution in its economic policy under the impact of massive economic problems. Since independence 20 months ago, even feeding Mozambique's 9 million people has become a major ordeal.
Far from pushing the rapid, and premature, nationalization of the tottering private sector, his government is actively courting the remaining private owners to keep their factories open.
"I get practically anything I ask for," said one one-Portuguese businessman here. "They are being as helpful as they possibly can."
The American General Tire Co. is about to open a new factory with government blessings, and there was a quiet campaign last year to persuade South African companies to make greater use of Maputo's big port.
In fact, there have been remarkably few nationalizations, and the private sector is still larger than the state one. This cautious economic policy is explained in large part, no doubt, by the fact that the government has been overwhelmed by trying to run hundreds of abandoned Portuguese farms and factories.
It may well also stem partly from Machel's realization that the socialist states, which he regards as Mozambique's "natural allies," do not have the means to pull the country out of its economic straits. Indeed, it is reported here that Moscow has been deliberately discouraging him from any precipitous break with South Africa, an action that could place an enormous burden on the Soviet bloc.
Western businessmen here fully expected Machel to announce the nationalization of banks or oil companies at the third congress of the ruling Front for the Liberation of Mozambique (Frelimo) that ended here Feb. 7. Instead, what they heard was a sober and honest appraisal by Mozambique's Marxist economic czar, Marcelino dos Santos, of the alarming state of disorganization within the state sector of the economy.
No visitor to this beautiful Indian Ocean port city of nearly 400,000 can help but be struck by the magnitude of the economic crisis. There are long lines outside every state-run "people's shop" for bread, meat and other basic food items. The shelves of stores are half bare, factories are running at half or less of their capacity at independence and unemployment has soared.
The available statistics confirm a visitor's immediate impressions. According to a 1976 United Nations report, Mozambique is running a $175 million to $200 million balance of payments deficit, a $275 million trade deficit, and will have to import over 200,000 tons of rice, corn and wheat this year.
In addition, the government has just announced its 1977 budget showing a deficit of $117 million, or more than one-third the total planned expenses. Western economists fear that this is an optimistic forecast.
The economy, they say, still has not "bottomed out" and can be expected to continue its downward path for a while longer as more of the remaining 20,000 to 30,000 Portuguese leave this year.
Furthermore, the key source of the country's foreign exchange earnings - gold obtained from South Africa at the old fixed rate of $42 an ounce in partial payment of wages of the 80,000 to 90,000 Mozambicans working in the mines there - is now in danger.
Mozambique then resold this gold at current world prices, tripling and at time even quadrupling its income. Last year, the repatriated wages of these migrant Mozambican mine laborers accounted for around 80 per cent of the country's foreign exchange earnings.
The new agreement now in the works is expected to fix the gold price at a much higher level, thus reducing substantially Mozambique's foreign exchange holdings. But the sale of electricity to South Africa from the huge Cabora Bassa hydro-electric complex in northwest Mozambique, scheduled to begin shortly, should help offset the decline in gold earnings.
The one bright spot in the otherwise bleak economic picture is that Mozambique presently has a healthy $124 million in foreign exchange holdings.
Some, but certainly not all, of the economic problems besieging the new government have been of its own making. The preciptous departure of so many Portuguese virtually stripping Mozambique of its skilled manpower stems at least partly from Frelimo's socialist policies that have proven distasteful to them.
But the whole Portuguese-Mozambican relationship was poisoned at independence by a white backlash, acts of economic sabotage and the anti-Frelimo activities of some Portuguese.
An already serious economic crisis was made worse by Machel's decision last March to close Mozambique's border with white-ruled Rhodesia as its contribution to the African nationalist cause there.A U.N. study calculates that this action will cost Mozambique between $108 million and $134 million per year.
The special U.N. fund set up to compensate Mozambique for its contribution to the war against the white minority Rhodesian government has collected only about $98 million mostly from Western contributors.
The pattern of contributions underlines the potential importance of the West to Mozambique. The single largest source of economic aid so far is turning out to be the Scandinavian countries that are mounting a joint, three-year, $45 million agricultural development project.
Britain is apparently the second largest donor, having committed itself to providing $27 million in aid and loans. The United States is giving Mozambique $14.5 million of which $10 million is a cash grant.
China at first offered a loan of more than $50 million on easy terms, but Western economists here say it is turning out to be more like $10 million. The amount of aid coming from other Communist countries is not known, but it appears to be considerably less than that being offered by the West.
While Frelimo's socialist polices and its commitment to the African nationalist cause account for some of the country's current economic plight, it is also true that the government has had an amazing streak of bad luck with the weather since independence. Last year and again now, torrential rains brought by Indian Ocean hurricanes have literally drowned the crops in many parts of the country.