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Mozambique to fight for extradition of former finance minister over debt scandal

Mozambique to fight for extradition of former finance minister over debt scandal
By Reuters
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JOHANNESBURG (Reuters) - Mozambique's government is to fight for the extradition from South Africa of former finance minister Manuel Chang, who the United States is seeking to put on trial, according to a letter from a law firm seen by Reuters.

Chang has been in custody in South Africa since his arrest in December at the request of the United States for his alleged involvement in $2 billion of borrowing U.S. authorities say was fraudulent. He denies wrongdoing.

Former South African justice minister Michael Masutha decided before leaving his post to extradite Chang to Mozambique, however his successor, Ronald Lamola, and a Mozambique civil society organisation have applied to the courts to have this set aside.

An affidavit filed on Lamola's behalf in mid-July said he wanted an opportunity to consider whether Chang could be extradited to the United States, where he faces charges including money laundering and conspiracy to commit fraud.

Now, a letter, from South African law firm Mabunda Incorporated and dated July 30, says the Mozambique government has instructed the firm to oppose these applications and bring a counter application in favour of Chang's extradition to Mozambique.

Alternatively, it said it would push for Lamola to consider "current information and facts as will be presented and argued" in upcoming hearings, as oppose to just the facts available when the former minister made his decision.

When contacted by Reuters about the letter, a Justice Ministry spokesman said it is now a matter for the courts.

Calls to Mabunda Incorporated went unanswered outside of usual business hours. A director of the firm that signed the letter did not immediately respond to an emailed request for comment.

The U.S. charges relate to loans obtained from Credit Suisse and Russia's VTB bank that were guaranteed by the Mozambican government, some of which it did not disclose, signed off by Chang during his 2005-2015 term as finance minister.

Their disclosure in 2016 prompted foreign donors including the International Monetary Fund to cut off support for Mozambique, triggering a currency collapse and debt default.

Mozambique only sought Chang's extradition after the United States' request, however he has not been charged with a crime in his home country - one of the points raised in the affidavit filed on Lamola's behalf.

If sent to face trial in the United States, analysts say Chang could reveal as-yet unknown details about the debt scandal, with potential implications for Mozambique's ruling party ahead of presidential, parliamentary and provincial elections in October.

Mabunda Incorporated also asked in the letter seen by Reuters for a court hearing scheduled for Aug. 13 to be postponed to Sept. 3, to give it time to prepare the necessary paperwork and to give all the parties an opportunity to respond.

Chang has already resigned from his position as a lawmaker, meaning he has lost his political immunity in Mozambique - another concern Lamola had with his planned extradition to the country.

If the court hearing is pushed back to September, that would give the country's Attorney General one month to file charges against him.

(Reporting by Emma Rumney; Additional reporting by Manuel Mucari in Maputo; Editing by Alison Williams)

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