The impact of privatization raises important questions about state/capital relations in post-war, post-socialist Mozambique. Does privatization indicate the withdrawal of state intervention in the economy and its replacement by a more efficient private sector, or are these objectives both unrealized and unrealistic? Will it result in a more productive economy which dispenses benefits not only to large investors, but also to small producers; or is it designed to enrich the few at the expense of the masses? Are we witnessing the creation of a stable, independent, economically prosperous country or simply a recolonization of Mozambique?

Three approaches attempt to conceptualize the state and capital relations that are arising from privatization and all three pervade public and scholarly discourse in Mozambique. The World Bank approach stresses the positive and beneficial aspects of privatization, whereas skeptics of privatization emphasize the loss of political and economic sovereignty that may come with the sale of state assets and the influence of Western donors. Officials in the Mozambican government, as well as representatives of some non-governmental organizations, embrace a third position. They argue that privatization represents a “smart partnership” or a marriage of interests between the private sector and the government that can bring mutual benefits to both participants.