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Exchange vzw. – jaarrapportering 2018 – Country Strategy Paper Mozambique 1

The information provided in this volume is designed to provide an introduction to the opportunities and challenges of ‘private entrepreneurship on SME level’ in the country

specified. Exchange vzw. has compiled the information and the references from various public and formal sources, as well as from its own activity, research and experience in the country. The ambition is to give insights, not to provide a

complete economic or legal guide to the private sector. The information is continuously updated and

completed. Exchange vzw. can not be held responsible for errors, omissions or lack of accuracy and disclaims any liability in connection with the use of this information.

Feedback is welcome at [email protected]


Table of Contents – Country Strategy Paper – Mozambique

Socio-‐political situation ...................................................................................................... 7

Economic situation ............................................................................................................. 7

Macroeconomy .................................................................................................................. 9

Key sectors and challenges .............................................................................................. 11

AGRICULTURE AND LIVESTOCK ......................................................................................................... 11

AGRICULTURE ................................................................................................................................ 11

POULTRY ........................................................................................................................................ 13

FORESTRY .......................................................................................................................................... 13

CONSTRUCTION ................................................................................................................................. 15

EXTRACTIVE INDUSTRIES ................................................................................................................... 16

NATURAL GAS ................................................................................................................................ 16

MINING .......................................................................................................................................... 17

TOURISM ........................................................................................................................................... 17

Imports and exports ......................................................................................................... 18

Trade Agreements ............................................................................................................ 20

Africa ............................................................................................................................................. 20

USA ................................................................................................................................................ 20

EU .................................................................................................................................................. 20

Other Bilateral Trade Agreements ................................................................................................ 20

Trade Relations with Flanders/Belgium ........................................................................... 21

Government and Organizations’ strategy ........................................................................ 22

The Beira Corridor ............................................................................................................ 24

Private Entrepreneurship ................................................................................................. 26

Ease of doing business ..................................................................................................... 27

Business climate for SMEs ................................................................................................ 28

Exchange vzw in Mozambique ......................................................................................... 29

Mozambique – representations, economic missions and contacts in Belgium – overview and hints.......................................................................................................................................... 30

Belgium ............................................................................................................................................. 30

Flanders ............................................................................................................................................. 34

Brussels ............................................................................................................................................. 36

Wallonia ............................................................................................................................................ 37

Belgium in Africa ............................................................................................................................... 39

Europe ............................................................................................................................................... 40

Interesting websites for information regarding Mozambique ......................................... 42


Introduction This document is a practical guide for Mozambique and a strategy for Exchanges work in this country. Information in this document is partially based (part I and II) on existing information (country papers FIT, JCA and JSF from the Belgian development organisations etc.), that are joint as annexes to this document. Based on this existing information both country and project coordinators determinate the country strategy with input from the local representatives (part III)

The annual review of this document (especially part III) will help Exchange to monitor and reorientate its work each year if needed.

The final goal of this document is not only to offer applicants a better service with long term impact, but also to create more visibility for Exchange in the country and a larger network with implicated actors both North and South.

At the beginning of each work year the Growth Programme coordinator and country coordinator will update this document with the most recent figures and will adjust the strategy of Exchange in the country if necessary.

List of abreviations: FIT (Flanders Investment & Trade), JSF (Joint Strategic Framework), JCA (Joint Context Analysis), NGA (Non Governemental Actor)


Figure 1: Mozambique map. From Worldmapsonline.com


Overview and general facts Mozambique, officially called the Republic of Mozambique, is bordered by Malawi and Zambia to the northwest, Tanzania to the north, the Indian Ocean to the east (with the coastline facing Madagascar), Swaziland (Eswatini) and South Africa to the southwest, Zimbabwe to the west. Its location represents a strategical advantage, as four of the bordering countries are landlocked and rely on Mozambique to reach global Markets About 70% of the population ( 28 million in 2016) resides in rural areas. Mozambique is rich in water, energy, fertile land, mineral resources as well as newly discovered natural gas offshore. It has three deep seaports, and a relatively vast pool of labour. The strong ties to the South Africa, the main economic engine of the region, impair its economic and socio-‐political development. When Mozambique reached independence in 1975, it was one of the poorest countries in the world. In the subsequent years, the country was further impoverished by civil war from 1977 to 1982, inefficient socialist policies and economic mismanagement. Through a series of macroeconomic reforms, international economic support, and political stability after the 1994 elections, the country’s GDP (in purchasing power parity) jumped from $4 bill ion in 1993 to $37 bill ion in 2017. Recent fiscal reforms have improved revenue collection. Despite these significant improvements, about one over every two people is below the poverty line and the majority of the work force is stil l relying on subsistence agriculture. Between 1990 and 2017, Mozambique’s life expectancy at birth increased by 16.0 years, mean years of schooling increased by 2.7 years and expected years of schooling increased by 6.0 years. GNI per capita increased by about 198.6 percent. (Sources: WorldBank, CIA Factbook, Human Development Report 2017-‐UNDP)


Population: 26,573,706 Languages: Emakhuwa 25.3%, Portuguese (official) 10.7%, Xichangana 10.3%, Cisena 7.5%, Elomwe 7%, Echuwabo 5.1%, other Mozambican languages 30.1%, other 0.3%, unspecified 3.7% (2007 est.) Ethnicity/race: African 99.66% (Makhuwa, Tsonga, Lomwe, Sena, and others), Europeans 0.06%, Euro-‐Africans 0.2%, Indians 0.08% Religions: Roman Catholic 28.4%, Muslim 17.9%, Zionist Christian 15.5%, Protestant 12.2% (includes Pentecostal 10.9% and Anglican 1.3%), other 6.7%, none 18.7%, unspecified 0.7% (2007 est.) Major urban areas -‐ population: MAPUTO (capital) 1.187m; Matola 937,000 (2015) Median age: total: 17.2 years; male: 16.6 years; female: 17.8 years (2017 est.) Population growth rate: 2.46% (2017 est.) Net migration rate: -‐1.9 migrant(s)/1,000 population (2017 est.) Life expectancy at birth: total: 53.7 years; male: 52.9 y; female: 54.5 y (2017 est.) Literacy rate: total population: 58.8%; male: 73.3%; female: 45.4% (2015 est.) HIV/AIDS -‐ adult prevalence rate:12.3% (2016 est.) Unemployment rate: 22.4% (2014 est.); 17% (2007 est.) Unemployment, youth ages 15-‐24: tot: 39.3%; m 40.2%;f: 38.7% (2012 est.) GDP (official exchange rate): $11.27 billion (2016 est.) GDP (purchasing power parity): $35.08 billion (2016 est.); $33.35 billion (2015 est.); $30.96 billion (2014 est.) GDP -‐ real growth rate: 3.8% (2016 est.); 6.6% (2015 est.); 7.4% (2014 est.) GDP -‐ per capita (PPP): $1,200 (2016 est.); $1,200 (2015 est.); $1,200 (2014 est.) GDP -‐ composition, by end use: household consumption: 71.5%; government consumption: 28.2%; investment in fixed capital: 20.5%; investment in inventories: 22.1%; exports of goods and services: 34.8%; imports of goods and services: -‐77.2% (2016 est.) GDP -‐ composition, by sector of origin: agriculture: 24.8%; industry: 21.6%; services: 53.6% (2016 est.) Gross national saving: 5.6% of GDP (2016 est.); 5% GDP (2015 est.); 17.2% GDP (2014 est.) Agriculture -‐ products: cotton, cashew nuts, sugarcane, tea, cassava (manioc, tapioca), corn, coconuts, sisal, citrus and tropical fruits, potatoes, sunflowers; beef, poultry Industries: aluminum, petroleum products, chemicals (fertilizer, soap, paints), textiles, cement, glass, asbestos, tobacco, food, beverages Industrial production growth rate: 5.4% (2016 est.) exports of goods and services: 34.8% imports of goods and services: -‐77.2% (2016 est.) Labor force: 12.5 million (2016 est.) Labor force -‐ by occupation:agriculture: 81%; industry: 6%;services: 13% (1997 est.) Population below poverty line: 46.1% (2015 est.) Inflation rate (consumer prices): 19.2% (2016 est.); 3.6% (2015 est.) Exports: $3.328 billion (2016 est.) $3.413 billion (2015 est.) Exports -‐ commodities: aluminum, prawns, cashews, cotton, sugar, citrus, timber; bulk electricity Exports -‐ partners: Netherlands 30.8%, India 15.2%, South Africa 14.6% (2016) Imports: $4.733 billion (2016 est.); $7.577 billion (2015 est.)

Figure 2:Age pyramind (CIA Factbook)


Imports -‐ commodities: machinery and equipment, vehicles, fuel, chemicals, metal products, foodstuffs, textiles Imports -‐ partners: South Africa 36.6%, China 10.9%, Netherlands 7.8%, Bahrain 5.2%, France 4.2%, Portugal 4.2%, UAE 4.1% (2016) Exchange rate MZM -‐ USD: 63.067 (2016 est.); 63.067 (2015 est.); 39.983 (2014 est.) (Sources: Flanders investment and trade, World Bank, the Observatory for Economic Complexity, Human Development Report, UNDP report.hdr.undp.org, CIA World Factbook https://www.cia.gov/library/publications/the-‐world-‐factbook/geos/mz.html).

Socio-‐political situation After almost five centuries as a colony of Portugal, Mozambique gained its independence in 1975, and plunged into a prolonged civil war until the 1990s. The Front for the Liberation of Mozambique (FRELIMO), created by Eduardo Mondlane became the ruling party, and Samora Machel was elected the first President of Independent Mozambique. The country remained formally Marxist until 1990, when a new constitution introduced multiparty elections and a free market economy. Fighting between FRELIMO and the rebel Mozambique National Resistance forces (RENAMO) was formally ceased through the negotiation of the UN in 1992. In 2004, after 18 years in charge, president Joaquim Chissano stepped down and was succeeded by Armando Guebuza, who served two terms and then passed the office to Filipe Nyusi in 2014. The political situation cannot be considered completely stable, as the residual armed forces of RENAMO have occasionally engaged in insurgencies since 2012. The political context is still marked by the scars left by 15 years of civil war, which have left the economy in ruin. Frelimo and Renamo are still the main political forces, followed by Movimento Democrático de Moçambique (MDM). Despite Frelimo victory in 2014 presidential election, which ensures a comfortable majority in the parliament, Renamo and MDM have gained ground. Occasionally, the preserved Renamo armed militias hidden in the country generates clashes with Mozambican armed forces, reviving the never-‐ending conflict with Frelimo. A cease-‐fire was achieved in December 2016, while Peace treaties between the two parties have been restored in August 2017, when the President Filipe Nyusi met Renamo leader, Alfonso Dhlakama. A Constitutional review was agreed between both parties, allowing for a further redistribution of powers. Working groups created from that event have developed reccomendations on central issues such as decentralization and military power, which are now discussed by the parliament. However, RENAMO’s president died from illness on May 3rd 2018, casting further uncertainty over the peace process. In addition, the attempts to find a sustainable political settlement are taking place against an uncertain economic outlook. Two years after the disclosure in 2016 of debt contracted without the required legal procedures (the so-‐called Hidden-‐Debts case), the Government is preparing a roadmap to address these liabilities and tackle the unsustainable debt position. Most options for resolution are likely to include a new IMF program, since then cancelled. With the 2019 Presidential election on the horizon, the challenging fiscal situation could limit the financial and political resources available to complete the process to achieve a conclusive sustainable peace settlement, which might require constitutional reforms.

Economic situation


Mozambique is one of the poorest countries in the world. Its Human Development Index score increased of 108.9% between 1990 and 2017, passing from 0.209 to 0.437, but the country remains in the low human development category and ranks 180th out of 189 countries. (Human Development Report 2017, UNDP) The average annual growth rate in Mozambique from 2005 to 2015 was 7%, constituting one of Africa’s strongest performances. However, the combination of internal military confrontations, important decreases in foreign direct investments, drought effects from El Niño, declining prices for traditional export commodities, and elevated external debt and inflation, nearly halved the average growth to 3.8% in 2016. Increased coal exports and agricultural production lead to a slight recovery in 2017 (4.7%) and 2018 (approx. 5.3%). The other sectors underperformed (2018 African Economic Outlook Country Note. Cia Factbook) The massive Mozambican foreign debt was reduced under the the IMF's Heavily Indebted Poor Countries (HIPC) and Enhanced HIPC initiatives. However, a 2016 scandal revealed that the Government offered in the previous years over $2 billion loans to state-‐owned defence and security companies without parliamentary approval or national budget inclusion. Consequently, the IMF and international donors stopped direct budget support to the Government of Mozambique. Despite an international audit performed on the country’debt in 2016-‐17, debt restructuring and resumption of donor support have yet to occur. (Sources: AEON 2018, AfDB Mozambique Country Strategy Paper 2018 -‐2022, WorldBank, CIA Factbook)


Economy

Macroeconomy The economy in Mozambique is slowly recovering from a difficult 2016, affected by the hidden debt crisis and with a consistent slowdown in growth and plunges of the country currency. Inflation remains very high at 18%, further reducing households’ purchase power. Small and medium enterprises have fallen back and their capacity to generate jobs has been restricted even further. The GDP growth in the first quarter of 2017 reached 2.9%, doubling the growth rate of the preceding quarter. The metical has reach stability in the last year gaining almost 30% value against the US dollar. Despite a positive GDP growth trend, which has been on average 7% in the last ten years, the Mozambican formal job market remains static and is unable to create adequate employment opportunities for the 400.000 young individuals joining the labour force every year. Accordingly, fostering entrepreneurship can help Mozambique to develop its potential. The private sector is strangled by high credit rates (on average 30% for a one-‐year commercial loan) and depressed private consumption. The result is a contracting real economy, except for the primary sector and some services.

SIGNIFICANT FISCAL DEFICIT Mozambique has incurred significant fiscal deficits in recent years, on average 5.1% of GDP during 2014-‐16. During the years of marked economic growth, the Mozambican Government expanded public expenditure, benefiting from low debt and revenues from the capital gains tax that limited overall deficits. The suspension of donor funding in 2016, after the discovery of illegal financing operations by the Government, further compromised fiscal stain and debt levels. Without access to international markets and donor direct budget support, the fiscal deficit has been financed exclusively through domestic borrowing with elevate costs. Without progress in the debt restructuring process to date, the country’s debt position remains unsustainable. The public sector wage bill still represents a significant burden, whilst recent cuts to the investment budget have heavy socio-‐economic repercussionst. Some of Mozambique’s large State-‐Owned Enterprises represent a financial risk that might compromise recovery efforts if not properly managed. HIGH INFLATION In the financial crisis following the 2016 disclosure of secret debts worth nearly 10% of GDP, the debt-‐to-‐GDP ratio reached an estimated 125% at the end of 2016, while the metical registered a 40% devaluation against the U.S. dollar and inflation suffered a 10-‐fold increase to 19.8%. The Central

Figure 3: Mozambique inflation and GDP variation. From Flanders Investment and Trade agency.


Bank implemented a restrictive monetary policy to control annual inflation from 25% in 2016 to 15.3% in 2017. Thanks to the stronger Metical and foreign currency inflows, year-‐on-‐year inflation reached 3.1% in March 2018. Despite of that, Mozambique’s reference lending rate is still amongst the highest in sub-‐Saharan Africa and average commercial bank lending rates in the region of 30% are prohibitively high for much of the private sector. Tangible signs as improved exchange rate, lower inflation, and lower credit levels suggest that the monetary policy cycle can become less rigid as the economy continues to adjust. The transition, however, will require a coordinated and robust fiscal policy response. GROWTH DRIVERS Minerals exports is being the main contributor to growth in the last two years, thanks to Infrastructure improvements and rising international prices. By end of June 2017, the mining sector registered a 59.4% year-‐on-‐year increase, driven by strong exports of coal, as well as graphite, titanium, rubies, and iron ore. The favourable weather supported agricultural production, the mainstay of the economy, which grew by 2.2%. In the next year, FDI are expected to be the main driver for growth. The development of the first offshore natural gas extraction project and other exploration projects will potentially bring FDI to over 40% of GDP, as in 2013. MAIN CHALLENGES The main challenges are restoring stability and reestablishing confidence through economic governance and increased transparency, including the transparent management of the hidden debts investigation. Moreover, structural reforms are needed in support of the currently struggling private sector. Another major challenge for the economy is to focus less on capital-‐intensive projects and low-‐productivity subsistence agriculture in order to promote a more diverse and competitive economy, as well as strengthening the key drivers of inclusion, such as improved quality education and health service delivery, which could improve social conditions and create the basis for economic development. 2016 SCANDAL AND CONSEQUENCES In 2016, the IMF and the development partners exposed fragilities in the governance framework of Mozambique. USD 1.4 billion in loans and guarantees previously kept hidden from the public were revealed, disclosing a hidden-‐debts crisis. Despite the launch of a criminal investigation into the case by Public Prosecutor’s Office and the admission by a parliamentary commission of the existence of criminal acts, two years later any result is yet to come. These challenges have been addressed by several initiatives. In 2017, the parliament presented a new law on State-‐owned enterprises to strengthen the governance framework, rationalize the financial sector, and assist in the mitigation of fiscal risks. New measure to enhance and parliamentary oversight have been approved, but their implementation in not ensured. It is the case of the anti-‐money-‐laundering framework which, despite being adequate in its structure, is not effective in its implementation.


(Sources: African Economic Outlook Country Note 2018, Flanders investment and trade, World Development Bank -‐ overview, the Observatory for Economic Complexity, Human CIA World Factbook).

Key sectors and challenges Due to infrastructure improvements and rising international prices, minerals exports was the main contributor to growth in 2017 and 2018. By end of June 2017, the mining sector registered a 59.4% year-‐on-‐year increase, driven by strong exports of coal, as well as graphite, titanium, rubies, and iron.

Better

weather patterns facilitated a 2.2% growth in agricultural production, the mainstay of the economy. From a structural perspective, FDI inflows are expected to be a main growth driver. The ongoing initial development stage of the first offshore natural gas extraction project is expected to be followed by exploration projects in other offshore areas, potentially bringing FDI to over 40% of GDP, in line with 2013 levels. The pre-‐investment decision preparations for the large-‐scale onshore liquefied natural gas projects continue to progress. The projects’ sheer magnitude, estimated to double GDP within 10 years, will continue to be the main positive for Mozambique. AGRICULTURE AND LIVESTOCK AGRICULTURE The majority of Mozambican workforce works in agriculture, but the sector is responsible for less than 25% of the national GDP. Despite the abundance of arable landmass, the advantageous geographic proximity to flourishing Asian markets and the long coastline, it is still prevalently a subsistence and small-‐activity. Only approximately 12% of cultivable land is used, and smallholder farmers produce almost 90% of the national food supplies. The main products are cotton, cashew nuts, sugarcane, tea, manioc, corn, coconuts, sisal, tobacco, citrus and tropical fruits, potatoes and sunflowers. Agriculture constitutes about 20% of total exports, but the balance of trade is still in deficit, with products such as rice that have to be imported to satisfy the high local request. Bottlenecks and challenges in the sector Several bottlenecks prevent farming and agribusiness to develop: lack of skills and knowledge among producers, underdeveloped value chains and market access for farmers, outdated production

Table 1: GDP by Sector. From afdb -‐ 2018 African Economic Outlook Country Note


technology (seed, fertilizer, agro-‐chemicals), lack of infrastructure, limited aggregation and market capacity, limited processing technology, and inadequate support from the government. The sector requires both private and public investment, and an enabling business environment. New private initiatives exist, but they require the support of public investment. LAND TENURE INSECURITY Responsible and stable investment in agriculture is threaten by land tenure insecurity. Mozambique’s land reform process and land administration system is improving the situation, implementation at the local level is still critical. Many foreign investors, especially China, Japan, and the Gulf States, are interested in acquiring large farm land, As subsistence farming constitutes the main (and often only) source of income in Mozambique, land grabbing constitutes an enormous threat for the population. UNPREDICTABILITY OF CLIMATE A significant challenge is the unpredictability of floods and draughts, that may disrupt agriculture and livelihoods. The World Bank promotes the development of climate-‐smart agriculture by promoting technologies in the form of drought-‐tolerant and short-‐maturing varieties. Investments in irrigation infrastructure and improvements in the management of public irrigation schemes will also contribute to mitigate drought risk. RESTRICTED ACCESS TO FINANCE Access to finance is another major challenge for agriculture development in Mozambique. Mozambique is ranked 138 among 190 economies in the ease of doing business, according to the 2018 World Bank annual ratings. Agribusiness have an extremely limited access to affordable finance. Local currency loans are typically only available at rates of over 20 percent, while foreign loans are difficult to obtain because of the relatively underdeveloped nature of the agribusiness export sector.Small and Medium Enterprises (SMEs) are unable to afford the conditions offered by financial intermediaries, usually requiring more than a 100 percent collateral. LIMITED INFRASTRUCTURE The limited expansion of infrastructure represent another important constraint. The poor quality of roads, the low coverage of railway service and the unreliability of existing rail services restrict farmers’ access to markets. The poor quality of electricity supply is adding to the costs faced by entrepreneurs across all sectors. Unclear labor laws in agriculture constitute an obstacle for the creation of jobs in the sector. Opportuinities Despite being chronically unfavourable, Mozambique’s investment climate is markedly improving. As measured by The World Bank Doing Business Indicators, it ranks 137 out of 190 countries in 2017, up 20 from 2014. GOVERNMENT’S ATTEMPTS TO IMPROVE THE INVESTMENT CLIMATE Private sector participation in agrobusiness is hindered by the several issues mentioned above. Also thanks to international pressure, the Mozambican government is deploying several initiative to improve investment climate in the agriculture sector. Agriculture represents an important contributor to rural poverty reduction and has the potential to narrow persistent income disparities between rural and urban areas in the country. It can be effective to improve those regions that did not obtain advantages from the economic gains of recent years. GREAT POTENTIAL FOR EXPANSION According to producers, processors and traders/exporters in several value chains, the country has a great potential for expanding and increasing productivity and efficiency. The gradual increase of private investments and introduction of new commercial models is supporting and low but steady agricultural transformation. According to the International Monetary Fund, the agribusiness-‐smallholder business models have the potential for up-‐scaling and to join productive commodity value chains, thus generating higher


incomes for farming households. Thus, creating the bases to compete on the international market. (IMF, 2014, “Mozambique Rising Building a new tomorrow” Page 73) MAIN CROPS Agriculture in Mozambique offers great variety but lacks in quality control and certification, which are fundamental to supply products in the international market. Local markets exist for rice, beans, maize, peanuts, and cassava. The production of other crops has increased in recent years, especially soya, sesame, tobacco, cotton, sugar cane, banana, and vegetables. Citrus and cashew also represent two traditional crops with significant growth potential. FEED PRODUCTION Given the constant increase of poultry consumption, various market studies show the potential for feed production, including soy, with possible margins above 20-‐25%-‐ The agricultural sector may be boosted by packaging and downstream manufacturing of several crops, such as cashew nuts, tobacco and sugar. The launch of new public private development initiatives such as the Beira Agricultural Growth Corridor (BAGC) can generate positive effects on long term productivity. However, the sector still needs important investments in irrigation, food storage, processing and logistic, as in the value chain farmers experience crop and post-‐harvest losses reaching 30-‐40% of the total. FRUIT PROCESSING Fruit processing ensures a better food supply and nutrition for the local market. It can provide the added value needed to reduce dependence on imports and increase competitiveness, as it extends the life of the fruit, standardizes the quality, increases availability reduces losses, and simplify distribution. The Mozambican fruits that can have a significant market value if processed are Mango, papaya, pineapple, guava, passion fruit, cashew, banana, coconut and citrus.1 POULTRY As a result of growing urbanization and income growth, the demand for chicken meat in the country has doubled in the last decade. According to the USAID Feed the Future report, it is expect to triple in the next ten years. However, domestic production has not kept the pace of the increasing demand. Chicken meat is mainly imported from Brazil, Asia and USA, for a value of approximately USD$23 million. 2.3 million smallholders are involved in the chicken meat sector, producing less than a third of total production. Value chain The poultry value chain includes the production of animal feed, mainly made of soybean and maize. However, overall, the national production of soybeans is not able to meet the needs of the poultry sector. There are only a few large scale commercial farmer cultivating soybean and maize, but their dimension is small according to international standards. According to Mozambican regulations, the imported feed has to come from non-‐genetically-‐modified (GM) producers such as India and Zambia, but controls are not always effective. Several international traders, such as Cargill and Afrigri are important actors as they aggregate the supply, store the production in appropriate facilities and offer capital to several poultry companies across different productive stages. The poultry sector faces a number of additional constraints: Limited access to seeds, limited quality and availability of domestic animal feed and legumes value chains. The World Bank estimates that less than 10 percent of Mozambican farmers use improved seed varieties, which is limiting yields and also reducing the quality of agricultural produce. FORESTRY The forestry sector is one of the sectors with the highest economic potential in Mozambique, especially in rural areas. Forests cover approximately two thirds of the land in the country and one third of it is adequate for commercial timber production. Several factors enhance Mozambique's 1 For detailed information on sesame and cashew production: https://letswork.org/wp-‐content/uploads/2016/11/background-‐report-‐review-‐of-‐current-‐key-‐sectors.pdf page 24

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forestry sector competitiveness in the global market: the large amount of land, the available ports (Beira, Nacala and Maputo), the proximity to Asia and South Africa as well as the relatively low price for land. It accounts for only 1 percent of the GDP and 10 percent of the industrial production, but the Government of Mozambique receives about USD$6 million in royalties from logging every year-‐ LOCAL ECONOMY RELIES ON FORESTS Households in rural Mozambique have a strong dependence on forests and woodlands for subsistence needs (food, shelter, energy) and cash income. Fuel-‐wood and charcoal are critical to national and household energy needs. According to the IGC, about 23.7 million m3 of fuel wood are consumed annually. PLANTATION VS. NATIVE FORESTS Wood in Mozambique can hail from either plantation forestry or native forest management. Plantation forestry is generated by tree plantation in licensed areas and usually companies in this sector are large foreign owned enterprises. Native forest management refers to the use of existing forest. In this case, harvesting is done under a license for a defined amount per year, mainly by local small logging companies. MAIN COMPANIES HAVE LONG TERM CONCESSIONS, SMEs HOLD SMALL LICENSES Usually, the main companies exploiting long-‐term concessions work on a vertically integrated system, covering all steps from logging to marketing. In contrast, small and medium enterprises (SMEs) hold small licenses. Their products is sold to sawmills and then goes directly to customers. Among the wood processing firms in Mozambique, a number of large companies are specialized in furniture manufacturing and export their end product. The production for the domestic market comes mainly from local carpenters working with basic carpentry. Formally, forestry accounts for about 10,200 direct jobs. However, informally the sector seems to provide more than 200,000 jobs. Considering both formal and informal companies, 99 % of the native forest enterprises are SMEs and account for 80 percent of employment in the sector. Additionally, 6850 formal and 184000 informal SMEs are trading non-‐timber products, including honey, charcoal, firewood, and handicraft.2 Challenges in the sector The forest industry in Mozambique faces a number of challenges and constrains. Forest are threatened by deforestation, as the Government of Mozambique estimates an annual deforestation of around 0.5% per year. The main causes of this phenomenon are forest conversion into agriculture and unsustainable production of biomass energy, while illegal logging often anticipates forest conversion to other land uses. The Environmental Investigation Agency (EIA) estimated that over 90 per cent of logging in Mozambique during 2013 was illegal, driven by booming timber exports to China, with a cost for Mozambique of US$146 million in lost exploration and export tax revenues since 2007. OVEREXPLOITATION The illegal overexploitation of the few species with commercial value could lead to degradation of Mozambique’s forests. There is limited enforcement of the forest management legislation, often logging concessions are not managed properly, and simple licenses awarded by local governments are also widely abused. One of the main issues, however, consist in the misuse of simple licenses for additional illegal logging: Asian companies buy timber from small-‐scale farmers with simple license sell for a much lower price than the market price, forcing companies with concessions to close their business. The main practice of illegal logging, however, seems to be the cutting of small diameters in the forestry concession and the uncontrolled exploitation outside of the simple licence area. China is the recipient of 80 percent of the unprocessed timber, and the discrepancy between the registered log in Mozambique directed to China and the amount of log registered in China as import is around 30-‐40% of the total.

2 For specific information on the main companies involved, https://letswork.org/wp-‐content/uploads/2016/11/background-‐report-‐review-‐of-‐current-‐key-‐sectors.pdf

Exchange vzw. – jaarrapportering 2018 – Country Strategy Paper Mozambique

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LACK OF SKILLS AND UNCLEAR FRAMEWORK The main challenges that SMEs have to face in the forestry sector are the low level of skills and knowledge about safety procedures, restricted harvesting rights, complicated registration and tax processes, missing possibilities for credit, and lack of transparency within logging licenses. The existing laws are often not implemented because of high levels of corruption, as well as due to lack of knowledge and human capital. The licensing process is very complicated and bureaucratic (many institutions involved) and the poor implementation of the regulations as well as the lack of political will hinder the implementation of the law. PRIVATE INVESTMENT Private investment has increased in the recent years, and can boost the growth of technical knowledge and skills, and promoting market access. Promising markets are the provision of charcoal to urban centres from sustainably managed woodlots, the production of furniture and other wood design goods, and the supply of poles and other construction material. The Finnish bilateral cooperation financed a modern wood products laboratory at the University of Eduardo Mondlane, which could acquire an important role in finding new uses for lesser known species and promoting the use sustainably produced timber, if provided with adequate business management guidance. CONSTRUCTION CONSTRUCTION INDUSTRY CAN LEVERAGE MOZAMBIQUE’S GROWTH The construction industry can be an important leverage of Mozambique’s economic growth. The demand for construction in Mozambique is significantly increasing, propelled by the growth of extractive industries, the need of large infrastructure (railways and roads, ports, etc.) and housing for the expanding communities in those areas, and the growing middle class in urban areas. PUBLIC INFRASTRUCTURE INVESTMENTS AFTER THE CIVIL WAR Since the end of the civil war in 1992, Mozambique has invested billions of dollars repairing roads and railways, enlarging harbors, and building new ground transport routes. The emerging urbanization and the growing middle class are pushing the growth of commercial and housing construction. Moreover, the country has a growing demand for heavy construction works in airports, ports, dams, electricity, railways, roads, and industrial production plants, including the gas industry. SMEs WORK LOCALLY, WHILE INTERNATIONAL FIRMS ARE INVOLVED IN PUBLIC WORKS The local construction sector is dominated by SMES, while civil constructions and public works are mainly conducted by large international companies. The local SMEs cannot compete with international large firms because of their lack of experience and skills. CONSTRUCTION COMPANES ARE MAINLY IN THE SOUTH. The construction companies are mainly concentrated in the south of the country, especially in Maputo province. Therefore, the growing demand in the north (Tete, Nacala, Pemba) is not efficiently satisfied. The companies within the construction sector are numerous and diverse, and the majority of them works in the informal market. 3 Value Chains The sub segments of construction sector in Mozambique include: civil and public construction, housing construction, the value chains of building material (raw material, building components, finishing’s, etc.), and related services ( access to finance, insurance, maintenance, repair, etc.). Housing construction Housing construction is crucial for economic development and SMEs in the sector have the opportunity to grow and develop. Supply remains deficient, while demand is slowly rising driven by

3 For more info on the main actors, https://letswork.org/wp-‐content/uploads/2016/11/background-‐report-‐review-‐of-‐current-‐key-‐sectors.pdf


urbanization and the emerging middle class. Urban lower and middle class are still unable to afford investments in formal housing, despite the strong economic growth of the country. Moreover, growth is slowed down by the complex processes for obtaining a construction permit. Local contractors and informal businesses dominate housing construction and the use of locally produced material. Despite the high competition within the sector, complaints about lack of skilled labor force and poor construction quality are common. Public and civil construction Public and civil construction are dominated by foreign firms, mainly from South Africa, China, and Portugal. As opposed to local companies, international companies are able to exploit their network with foreign investors and markets and can act flexibly, obtain financial credit, import labor and material, procure the contracts as well as deliver the needed assets to secure the contracts. Moreover, the lack of skilled labor leads companies to provide in house training. Building material The construction material is divided in raw material (wood, sand, stone.), intermediate input (bricks, cement, steel, etc.), building components (electrical material, frames, etc.), and finishing elements (glass, paints, etc.). 91% of the companies dealing with building materials are micro and small enterprises, mainly located in the south of the country, unable to compete with international firms’ capacity and experience. Foreign companies have better links to foreign markets, importing construction material with better quality and price. The limited pool of domestic suppliers is unable to deliver intermediate inputs to the highest international standards, and the existing procedures for importing goods (VAT procedure) is a burden for local enterprises, which are often not able to compete with the large international companies. Approximately 60% of building materials used in Mozambique is imported, mainly because companies believe that domestic suppliers fail to deliver on time and provide low-‐quality materials. EXTRACTIVE INDUSTRIES Only in recent years Mozambique has discovered its abundant reserves of natural gas and coal. The country’s first overseas export of coal came in 2011 from Tete Province. In 2012, four of the world’s five largest natural gas discoveries were made in Mozambique’s offshore Rovuma. A massive inflow of foreign investment financed mega projects such as Vale, Rio Tinto, Jindal, Anadarko, ENI, Sasol, among others, attracted by early estimates of the sheer volume of untapped natural gas and coal reserves. In 2011, the government a total amount of USD$3,4 billion in investments. Recently, the falling market prices for coal and gas has slowed down the expansion of production. However, the forecasts remain strong. The natural resource sector has propelled the country’s rapid growth during the last years, but its real impact on local economy remains weak. Mozambique can rely on various natural resources including titanium, coal and natural gas. The extractive industry’s currently contributes, in taxation alone, 4.1 percent to the national gross domestic product (GDP), and it is expected to growth. However, the development of the sector has not led to any significant development outcomes in the rest of the local economy. NATURAL GAS The recent gas discovery in the north has made Mozambique globally relevant. Gas has been discovered in two areas, in the south in Inhambane and in the north, in the Rovuma Basin (Cabo Delgado). Exploration in the offshore Rovuma Basin in 2012 confirmed the natural gas volumes in excess of 100 Tcf (comparable with Norway), considered one of the largest natural gas reserves in the world. CORAL OFFSHORE FEILD DEVELOPMENT The most significant economic development of 2017 was the final investment decision by ENI (Italy) for the Coral offshore gas field first phase development. Its size is relatively small, with an estimated production of 3.4 million tons of gas per year. Despite being smaller than the Pande and Temane onshore fields that have been in production since the early 2000s under Sasol (South Africa) and the limited spill-‐overs that it will bring to shore, it constitutes the first development in the Rovuma basin.


GAS DEPOSITS EXPLOITMENT IN CABO DELGADO The American companies ExxonMobil and Anadarko are leading two consortiums seeking approval to develop massive natural gas deposits off the coast of Cabo Delgado province. Anadarko (USA) is developing a USD 24 billion liquefied natural gas (LNG) onshore plant. Negotiations to define agreements and the project finance are in an advanced state and the final investment decision is probably going to be confirmed in 2019. It might become the largest infrastructure projects in Africa. According to government’s predictions, sales of liquefied natural gas from these projects could start generating annual multibillion dollars revenues after 2022. The project has the potential to create a downstream value chain able to develop a domestic industrial cluster. The main challenges will be the creation of linkages in the region and between the sector and the domestic economy, the resilience and competitiveness of the real economy. MINING The coal reserves located in the north of the country, in the region, are estimated to be the largest, unexploited, high-‐value coal reserve in the world. Mozambique’s mining activity is growing during the recent years, with massive anthracite and other high quality coal reserves, massive titanium minerals’ resources; other minerals such as tantalum, limestone; and high prospects for gold, platinum group, uranium, iron ore, and bauxites. In the coal sector, the estimated quality of the coal resulted to be less high than initially announced, decreasing the price of the coal. Combining this factors with the general decrease of the coal price at the world market the business is less profitable for the investors. Logistics represents another main Challenge for the industry in the country. As it creates a bottleneck and increases the production costs. Job Creation The expected employment growth of the extractive industry during the past years, has not been realized. Only a limited spillover effect took place with the majority of the community not receiving any benefit. Of the promised jobs, only a fraction has been realized. The extractive industries are not labor intensive: the need for employment is high only during the construction phase, while it drops sharply after and leaves only a few permanent, mainly high skilled jobs. lack of skills in the local workforce Despite the existence of a foreign quota in the country, the majority of the private sector imports skilled workers. because of the poorly trained labor force in Mozambique. Moreover, the country suffers from a tremendous skills shortage within all levels and sectors. Companies have not only problems to hire managers and engineers but also lower skilled labor. The low quality of instruction do not provide both technical and soft skills to even be hired for lower skilled labor. The education sector is weak and the public technical vocational training has not been able to respond to the needs of the labor market/ private sector. TOURISM TOURISM COMPROMISED BY CIVIL WAR Despite its tourism assets and its closeness to South Africa, a world's top tourist destinations, Mozambique has one of the lowest number of tourists in the area. Before independence, tourism was a very profitable industry. Beira and Mozambique's southern beaches, and Gorongosa National Park, were destinations by Rhodesians and South Africans. After independence from Portugal, the Mozambican Civil War compromised tourism industry and wildlife conservation in the country. In the last decades, the confidence of tourist operators has been growing and the country has a great potential to become an important tourist destination. However, inadequate marketing budgets and a lack of tour operators has limited the growth of the industry so far. FAST GROWTH IN THE 1990’S In the late 1990’s the fast-‐paced growth of tourism led Mozambican Government to appoint a Minister for Tourism. In 2005 the tourist industry grew by 37%, becoming the fastest growth rate in


the sector worldwide. However, it remained one of the less productive tourism industries among the Sub-‐Saharan countries. The industry attracts more foreign investment than any other part of the country's economy TOURISM INDUSTRY STEADY GROWTH Travel and Tourism in 2017 contributed directly to 3.4% of total Mozambican GDP, with 455.9 million USD. However, it is forecast to rise by 7.3% in 2018 and to increase by 5.1% per year in the next decade. Considering the spill overs of Tourism on Mozambican economy in general, it is calculated to generate a total contribution of 1177.0 million USD, equal to 8.8% of GDP. In 2017, the sector supported 271,500 jobs (2.8% of total employment) and attracted investment for 224.1 million USD. Leisure travel spending generated 36.2% of direct Tourism GDP, compared with 63.8% for business travel spending. The majority of spending comes from domestic travel, generating 77.3% of the total, while the remaining 22.7% comes from visitor exports (i.e. foreign visitor spending or international tourism receipts). About one-‐third of the country's visitors are from South Africa. LIMITED AIR CONNECTIONS The average occupancy rate of hotel beds in the country is just below 40% and it is mainly focussed in Maputo. Access to land to develop new hotels is slow and expensive, and air access to the country is limited: the only European direct connection is to Portugal, while there are other regional services to Dar es Salaam, Harare, Johannesburg and Nairobi. Domestic transport is limited and often not punctual. The country's visa regulations requires European Union citizens to have visas, which now can be made on arrival. (Sources: African Economic Outlook Country Note 2018; Flanders investment and trade; World Development Bank – overview; the Observatory for Economic Complexity; Human CIA World Factbook; International Growth Center ‘An Enterprise Map of Mozambique’-‐ John Sutton, 2014. Page 10; UKAID ‘Enterprise Development Approaches in Mozambique Forestry Study Report’ -‐ Business Works Lda. 2014; Deloitte ‘Mozambique’s Economic Outlook’ 2016; OECD ‘Tourism in OECD Countries 2008: Trends and Policies’, OECD Publishing, p. 64-‐68; Broadman, Gozde, Plaza, 2007, ‘Africa's Si lk Road: China and India's New Economic Frontier’, World Travel & Tourism Council ‘Economic Impact 2018 Mozambique’; World Bank Publications; Government of Mozambique ‘Readiness Preparation Plan’2013. Environmental Investigation Agency ’First class crisis: China's Criminal and Unsustainable Intervention in Mozambique's Miombo Forests’ 2013; World Bank, Let’s work strategy for Mozambique, October 2015)

Imports and exports


Mozambique represents the 111th largest export economy in the world. In 2017, it imported $4.18B and exported $5,05B. The top exports are: Raw Aluminium ($861M), Coal Briquettes ($506M), Raw Tobacco ($279M), Rough Wood ($259M) and Electricity ($251M). Its top imports are: Refined Petroleum ($898M), Aluminium Oxide ($256M), Chromium Ore ($241M), Electricity ($225M) and Ferroalloys ($223M). Mozambique’s main export destinations are South Africa ($810M), China ($435M), Italy ($387M), India ($360M) and Spain ($171M), while the top import origins are South Africa ($2.31B), China ($1.31B), India ($873M), Australia ($275M) and Zimbabwe ($267M). (The Observatory of Economic Complexity,2018).

Figure 4: Export and Import ranking (2017). Source: Flanders Investment and Trade

Figure 6: Total annual imports variation. From Flanders investment and Trade agency

Figure 5: Mozambique’s main imports and exports


Trade Agreements Mozambique is involved in several bilateral and multilateral trade agreements with other countries in Africa and worldwide. Africa The Southern African Development Community (SADC) is currently implementing the organization’s trade protocol, which eliminate trade tariffs on certain goods among the 15 SADC member states. If fully implemented by all members, the protocol will give Mozambican products reciprocal duty free access to a market of over 253 million people, with an estimated GDP of USD563 billion. The first deadline to implement the new tariff agreements was in 2015, but it has not been respected by all members. USA Under the African Growth and Opportunity Act (AGOA) and the Generalized System of Preferences (GSP), a wide range of Mozambican products have duty-‐free entry to the United States. A key point included om the AGOA is the duty-‐free entry of apparel manufactured in Mozambique, including apparel manufactured with third-‐country fabric. The preferential arrangements contain no reciprocal treatment for U.S. products entering Mozambique. EU Certain Mozambican products currently enjoy reduced tariffs or duty free entry into European Union (EU) member nations under an Everything but Arms (EBA) arrangement, according to the terms of the Cotonou Agreement. Mozambique is currently negotiating an economic partnership agreement with the EU as a member of the SADC block of countries. Other Bilateral Trade Agreements Mozambique and Malawi entered into a preferential trade agreement in December 2005. The agreement was originally signed by the Portuguese colonial authorities with Malawi prior to Mozambican independence, and it ensures free trade of goods originating in the two countries, excluding tobacco, sugar, vegetable oil, chickens and eggs, beer, several soft drinks, office equipment, petroleum products, weapons, ammunition, and explosives. The Mozambique-‐Malawi agreement has simpler rules of origin than those outlined in the SADC Trade Protocol. Mozambique is also working on a preferential trade agreement with Zambia.


Trade Relations with Flanders/Belgium In 2017, Flanders’ merchandise trade balance with Mozambique hit a deficit of € 44,66 million. Total exports from Flanders to Mozambique amounted to € 25,44 million, while total annual imports reached € 70,09 million. Pharmaceutical products compose the main share of goods exported to Mozambique, constituting

32,9 % of the total. Other main products exported are Machines, devices, and mechanical tools (18,7%), Mineral fuels, petroleum and distillation products (11,3%), and Fertilizers (11,2%). Among imported goods, Tobacco and Tobacco substitutes constitute 68,5% of the total imports from Mozambique, while Aluminium and applications represents 27,6% of the total products reaching Belgium.

Almost 60% of the exports to Mozambique comes from Flanders, while the remaining part is split between Wallonia and Brussels (22,1% and 20,7% respectively). Differently, Flanders is the recipient of 99% of imports from the Sub-‐Saharan country.

Figure 7: Global goods trade between Flanders and Mozambique in 2017. From FIT

Figure 8: Belgian export/import per region. (From Flanders investment and trade)


(Source: Flanders Investment and Trade; US Government Export; World Bank; National Bank of Belgium )

Trade balance between Belgium and Mozambique, showing sharp drop in 2016 due to financial scandal (loan UBS bank)

Figure 9: Flanders -‐ Mozambique: main imported and exported goods


Government and Organizations’ strategy The economic policies enacted by the Government aim to strengthen prices for aluminium, coal and gas, to foster agriculture and to support SMEs. Furthermore, progresses in peace talks would markedly steer the national growth. MOZAMBICAN GOVERNMENT PLANS INVESTMENTS TO BOOST ECONOMY The Government of Mozambique intends to invest in economic and social areas with the aim of boosting economic growth and development through actions aimed at improving production and productivity levels. In this context, some business opportunities open up. According to Governmental claims, a public investments of 180 million USD will finance projects regarding Agriculture and Rural Development, Mineral Resources and Energy, Industry and Commerce, Transportation and Communication, Infrastructure (Roads, Water and Public buildings), Education, and Health.

According to the World Bank, the main issue in Mozambique development is translating the positive economic growth into social development and poverty alleviation. After the civil war, economic growth and poverty alleviation progressed harmoniously, but poverty alleviation decreased significantly after 2003. This may be caused by a growth model based on large capital-‐intensive public and private investment projects with limited links to the rest of the economy, which benefited the minoritarian urban areas and impacted only minimally the low formal employment rate. Consequently, poverty is mainly concentrated in rural areas and inequality has increased. Coherently, international organizations promote a more diversified and competitive economy, moving away from capital intensive projects and subsistence farming and increasing education and health services’ quality.

Other factors influencing the country’s growth are related to health and education. The high mortality rate of malaria, causing 35% of child deaths and 29% of the total number of deceases. Despite its prevalence has slightly decreased, HIV still afflicts 11,5% of the population. The average education is also worrying: according to the national statistics, in 2013 only 6,3% of the students in the 3rd class had a satisfactory reading proeficiency. Mozambique has also one of the lowest level of water consumption per capita, despite a wide variety of water resources.

Figure 10: Quality of infrastructure in Mozambique. From World Economic Forum


The Beira Corridor In the developing world, a new trend is taking hold: governments are targeting public and private investments in specific geographic areas aiming at creating spatial “development corridors.” The rationale of this strategies lays in the belief that concentrated infrastructure investments in specific locations can create clusters of interconnected companies, favour the development of value chains, increase employment, and increase basic public services. Since the late 1990s, Mozambican government has made several infrastructure investments to establish a development corridor between the seaside port of Beira and the country’s central provinces near Zimbabwe.

During the World Economic Forum at Davos in 2009 the Government of Mozambique, in partnership with the private sector and the international community, launched the Beira Agricultural Growth Corridor (BAGC) initiative, which aims to stimulate a major increase in agricultural production in the Beira corridor and improve the productivity and incomes of smallholder farmers. The BAGC initiative has a regional dimension, and therefore needs to extend to Malawi, Zambia and Zimbabwe in order to reach its potential.

Figure 11: The Development of Beira Corridor as seen through nighttime. Adapted from AidData


The Beira corridor has the potential to become a major new agricultural producing and processing region over the next twenty years. Its extension offers more than 190,000 hectares of fertile land, with could provide crops profitably in domestic, regional and international markets. Investments in commercial agriculture would generate major direct and indirect benefits for smallholder farmers and the rural community generally. The key constraints that have prevented successful development of commercial agriculture in the

Beira corridor are poor access to infrastructure to support agriculture (irrigation, grid-‐connected electricity and all-‐weather feeder roads), lack of access to finance, and insufficient experienced agricultural entrepreneurs and senior managers. At present, the rural population in the corridor is mainly reliant on subsistence agriculture and remains very poor. To foster BAGC’s development, four key issues have been identified: 1)Appropriate financing mechanisms, 2)strong commitment to success from government, private sector and international community, 3)effective mechanisms for coordinating decision making and actions of stakeholders, and 4)effective mechanisms for ‘on-‐the-‐ground’ implementation of investments. Moreover, The Beira corridor is a direct gateway to South East Africa, may play a focal role in regional development. The preferential access to the sea for landlocked countries in the area is through South Africa, but its main ports (Beitbridge and Durban) are distant and overloaded. Therefore, the Beira Corridor can constitute an efficient alternative gateway to the sea. (Sources: AidData ‘what are development corridor strategies and do they work, European Commission International Cooperation and Development, AGDEVCO -‐ Beira Agricultural Growth Corridor Report, Zimbabwe Sunday Mail -‐ Make Beira Corridor top priority)

Figure 12: The Beira Corridor. From AGDEVCO Beira Agricultural Growth Corridor Report


Entrepreneurial context

Private Entrepreneurship Private sector in Mozambique is still developing, representing just 65% of GDP. It is characterized by low competitiveness and low productivity. MSMEs comprise about 98.3% of the total number of companies registered in the country, yet contribute 28% to GDP, employing 24.1% of the formal workforce. The sector is predominantly composed by individual entrepreneurs and micro enterprises. Micro companies represent 79.6% of the total, small 9.6% and medium sized enterprises 9.1%. Mozambique’s economic growth in the last years has mainly been driven by multinational foreign firms, export-‐oriented and capital-‐intensive. However, FDI that was directed towards SMEs during 1992-‐2010 created 19 times more employment than the FDI into megaprojects. Business, and in particular agrobusinesses, have to face high transport costs due to poor infrastructure (including low access to energy), increased logistics costs, inefficient ports, and a costly business environment (administrative costs, tax, corruption, etc.). In the World Economic Forum’s Global Competitiveness Index 2018 access to finance’ and ‘corruption’ remain the main constraints for doing business, while, according to the World Bank’s Doing Business 2018 Index ‘enforcing contracts’ and ‘getting credit’ are the biggest difficulties entrepreneurs face. Other significant constraints are inefficient Government bureaucracy, inadequate supply of infrastructure services, inadequate educated workforce. The ineffective judicial system favoured the birth of specialized courts for commercial arbitration, which offers opportunity to individuals to settle commercial disputes. The barriers to access finance, especially the high costs of borrowing from banking institutions, were further exacerbated by the Government’s massive arrears to the private sector. Private investment is mostly limited to self-‐finance. Addressing infrastructural constraints, legal and regulatory reforms, and creating the condition for skilled and adequately trained workforce, is critical to enable the progressive structural transformation and diversification of Mozambique’s productive fabric, therefore fostering productivity, competitiveness, and access to markets. Financial sector Despite a significant expansion of Mozambique’s financial sector in the last ten years, financial inclusion remains low. Approximately 70% of Mozambicans are without a bank account at a formal financial institution, while only 3% of the population has access to formal credit. The 19 registered banks’s assets represent 67.2% of GDP in 2016. However, the top three banks account for 95% of the sector profits. Overall, the banking system is well capitalized and banks have posted considerable profits from lending to the Government at high real interest rates, but at the same time crowding out credit to the private sector. The uneven liquidity in the system, however, constitutes a risk for smaller banks, which are vulnerable to the economic fluctuations. The Central Bank is the regulator of the stock exchange, which has only four companies listed, with a market capitalization of 4% of GDP. (Source: IPEME, Matheus Zimba/ Deloitte Report; 2018 African Economic Outlook Country Note; World Bank Ease of Doing business report)


Ease of doing business

The yearly doing business report developed by the World Bank Group compares business regulations for domestic firms in 190 economies. The doing business report looks at domestic small-‐ and medium-‐size companies and measures the regulations applying them through their life cycle. The report provides quantitative indicators giving a unique insight in business climate of an economy. Mozambique ranks 135 out of 190 on the Ease of Doing Bussiness (DB) scale. The DB score measure shows the distance of each economy to the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to the best performance is reflected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the best performance. The ease of doing business ranking ranges from 1 to 190. The DB for Mozambique is 55.53 and the rank is 135. Mozambique’s score is a little higher than the average in Sub-‐Saharan Africa (DB 51.61), but significantly lower than those of the neighbouring country South Africa (DB 66.03, rank 82). Although the Ease of Doing Business ranking is often perceived as an inspiration for countries to reform business policies and laws it also receives a lot of criticism. DB limits:

- Doing business measures the legal framework, rules and procedures but not the actual practice - It doesn’t cover the reality of small firms in developing economies because most operate in

the informal sector - DB doesn’t deal with corruption - DB is said to favour the interest of business over that of citizen more broadly - DB advocates a ‘one-‐size fits all’ ideology4

4 The open access report offers useful details on how to open a new business in Mozambique. Available at: http://www.doingbusiness.org/content/dam/doingBusiness/country/m/mozambique/MOZ.pdf


Business climate for SMEs Small and medium enterprise (SME) development has been broadly acknowledged across the globe as the key driver to reduce unemployment and poverty. Many governments, both in developed and the developing countries are therefore trying to establish fertile a macroeconomic environments to favour the birth and growth of new companies. Africa has also come to the realisation that SMEs are the key to reducing the chronic underemployment and resultant poverty on the continent

MAIN COSTRAINTS Economic conditions remain challenging and the recent improvement relies heavily on the country’s recovering coal and gas industry. With much of the country’s outlook for growth hinging on the extractives sector, fluctuations global commodity prices will continue to pose large economic risks.

Investors and entrepreneurs must deal with corruption, and underdeveloped financial system, poor infrastructure and high on-‐the-‐ground costs. Transportation inside the country is slow and expensive, while bureaucracy, port efficiencies complicate imports and exports.

Access to markets State owned enterprises (SOEs) have their origin in the socialist period directly following Mozambique’s independence in 1975. There are a variety of SOE’s that compete with the private sector. Government participation varies depending on the company and sector. Some of the largest SOE’s have monopolies in their respective industries (famous LAM). There is no formal program to incorporate SME's into these markets.

Corporate stakeholders like Anadarko and Mozal are establishing initiative and syndicates to finance, train and support SME’s and start-‐ups. While these are companies in the extractive sectors, the benefits flow through the entire value chain, including training, construction, finance, technology and manufacturing.

While international investors are pouring in into Mozambique, local venture capital or angel networks are still embryonic. The culture of patron investing and funding start-‐ups in Mozambique is still very new to the country. This is also a feature of the shortage of innovative ideas, largely, due to the schooling and university system.

DIFFICULT ACCESS TO CREDIT Access to affordable credit remains the top constraint for business development as 75% of micro, small, and medium-‐sized enterprises are financially excluded, in particular in the rural areas. A few initiatives by international organizations and public-‐private partnerships have tried to ease access to credit in rural areas, but the results are still dissatisfying. According to a study5 published in 2016, funding programs and financial schemes to support SMEs, and entrepreneurs are not aware of the opportunities provided by the government and private sector. The banking system tend to discriminate SMEs because of high risk in lending to them, while the regulatory structure further impede access to finance.

(Sources: AFDB ‘Mozambique Country note; UK Government ‘Doing Business in Mozambique’; African Economic Outlook Country Note 2018; Flanders investment and trade; World Development Bank – overview; the Observatory for Economic Complexity; Thinkroom Consulting; Deloitte ‘Mozambique’s Economic Outlook’ 2016; World Bank, Let’s work strategy for Mozambique, October 2015)

Osano HM, Languitone H (2016). Factors influencing access to finance by SMEs in Mozambique: case of SMEs in Maputo central business district 5. Journal of Innovation and Entrepreneurship. 5:13


Exchange vzw in Mozambique Historically, Mozambique has represented a difficult context for international organizations. The political instability after the independence and the complex socio-‐economic dynamics in the country have constituted significant obstacles to the implementation of a wide variety of initiatives and projects. On the other hand, Mozambique is characterized by an enormous growth potential given by a favourable geographical positions, fertile land, valuable resources and the progressive development of young business clusters. Exchange has accepted the challenge and is giving its contribution for the flourishing of a new entrepreneurial spirit in the country. In line with its mission and vision, Exchange’s activity in Mozambique aims to improve Socio-‐economic development supporting the Private Sector (Sustainable Development Goal nr. 4) and creating partnership with other actors involved in the country (Sustainable Development Gaol nr.17). After a revision of all the past ad-‐hoc projects in Mozambique and a detailed analysis of the context, Exchange vzw initially defined a general strategy in the country. Through two Scoping missions in early 2018, it was possible to further refine our analysis and select four sectors that could potentially benefit from Exchange’s growth programmes: Agro-‐industry, Tourism, Manufacturing and Service sector for enterprises. From the initial four geographical areas identified, the Mozambique team decided to focus its initial activity in two regions:

- the Maputo province, undoubtedly the crucial business centre of the country, where NGOs, donors, and Government institutions . Fortunately it is foreseen that the activities will be extended to Inhambane Province.

- Inhambane province, interested by several zesty business initiatives.

After an intensive selection, two local representatives have joined Exchange’s team. Both young but experienced entrepreneurs, they have given a fundamental contribution to understand the Mozambican context and the sub-‐Saharan business world. In 2018, Exchange evaluated more than 30 SMEs in the country. Two of them have already beeing involved in Growth programmes, while other ten entrepreneurs are going through feasibility studies that may eventually lead to new growth programmes in 2019. Apart from assessing the potential of the Mozambican entrepreneurs interested in Exchange’s model, feasibility studies lay the foundations to involve potentially interested entrepreneurs in the North at a later stage of the programme. Selected companies will then be invited to join a coaching programme elaborated in close collaboration with the companies. It will outline a clear plan of operations/time line that last approximately 2-‐3 years. The first two promising Growth Programmes in Mozambique have begun in the second half of 2018:

- UX, a creative IT company, which already represents a successful story of young entrepreneurship.

- Mozambikes, which is bringing back the production of bicycles in Mozambique with a business model that offer a reliable and convenient mean of transport to disadvantaged communities.


Mozambique – representations, economic missions and contacts in Belgium – overview and hints The key to doing successful business abroad is above all selecting the right partners that can guide and assist you on this exciting challenge. The organizations listed below can assist companies that are looking to do business in Mozambique in any possible way. Some organizations focus on export and import while other focus on business investments. Other organizations will guide you in the administrative side of business, others on the legal side. Belgium

Mozambican Embassy in Belgium

Ambassador Ana Nemba Uaiene

Address Bd Saint-‐Michel 97 1040 Brussels Belgium

Phone number 0032 -‐ (0)2 -‐ 736 00 96 0032 -‐ (0)2 -‐ 736 25 64

E-‐mail [email protected] Website http://www.embassyofmozambique.be/index.php?lang=en Tags § Diplomacy

The Mozambican Embassy in Belgium should always be your starting point if you consider doing business or investing in Mozambique. The embassy can provide you with a wide range of info about the business climate in Mozambique going from economic policies to useful contacts. They can also give you advice on practical matters such as required documentation, which bank to choose and which official institutions to register at.

Federal Public Service Foreign Affairs (FPS)

Address Rue des Petits Carmes 15 1000 Brussels BELGIUM

Phone number 02 501 81 11 E-‐mail Contact form on website:

https://diplomatie.belgium.be/en/Contact Website https://diplomatie.belgium.be/en Tags § Economic policies

§ Business Regulations The FPS is the official institution collecting and distributing information about Belgian foreign policies. On their website you can find a lot of relevant information such as documentation on economic and trade-‐related matters, information on regulations governing trade, information on commercial activities, details of market opportunities, customs regulations, collecting and passing on business proposals, regulations and possibilities for claiming back VAT, information on


companies' right of establishment and company law, cooperation with and participation in foreign stock markets. Moreover, FPS is charged with the task of organizing study days, seminars and colloquiums organisation of missions, assisting missions organised by federal and regional authorities, trade associations, clubs of exporting companies, organisation of competitions to award prizes to companies or individuals which/who have made a special contribution towards promoting Belgian exports, production of magazines or special publications. Lastly, they can also provide you with the contacts of the Chambers of Commerce and Belgian Business Clubs in the foreign country.

Finexpo

Finexpo is an inter-‐ministerial advisory committee managed by the Administration of Foreign Affairs. Finexpo handles the files submitted by companies and/or banks that request government support for their export credit. Finexpo provides 6 concessional services (gift, interest payment with or without gift, mixed credit, technical assistance, unbound loan from state to state, SME instrument) and 1 commercial service (interest stabilization).

The Belgian Foreign Trade Agency and Federal Public Service

Foreign Affairs (BFTA) (ABH-‐ACE)

Address Belgian Foreign Trade Agency Rue Montoyer 3 1000 Brussels BELGIUM

Phone number + 32 2 206 35 11 E-‐mail secretariat@abh-‐ace.be Website https://www.abh-‐ace.be/en Tags § Export

§ Investment The Belgian Foreign Trade Agency (BFTA) operates at the service of three Regional bodies for export promotion: FIT in Flanders, BIE in Brussels and AWEX in Wallonia. Furthermore, it is operating at the service of FPS Foreign Affairs. Consequently, it offers a platform where the regional jurisdiction of International Trade and the federal jurisdiction of International Politics can meet. The agency offers 5 major services:

1. Economical Missions: BFTA organizes economical mission in collaboration with FIT, BIE, AWEX and FPS. These missions are open for members of the regional agencies and incorporate the international politics by inviting the king, his ambassadors and/or ministers of foreign affairs. These mission give a lot of

2. Trade4U: The agency offers a mobile app (Trade4U) at a yearly price of €150. Trade4U functions as a platform to send targeted international opportunities to the subscribed


companies. Moreover, the app distributes useful economical and juridical information about foreign trade.

3. Juridical Advice: BFTA offers Juridical advice on international trade and distributes information on relevant policies. Moreover, they provide guidelines on 3 specific topics:

• Buying & Selling: http://incoterms.abh-‐ace.be/en/index.html • Distribution: http://distribution-‐channels.abh-‐ace.be/en/index.html • VAT: http://vat.abh-‐ace.be/en/index.html

4. Statistics of Foreign Affairs: BFTA provides you with extensive statistics and analyses about foreign affairs.

5. Economic Studies: Lastly, the agency executes and distributes sectoral publications, country studies, global macro-‐economic overview and customized analysis.

Federation of Belgian Chambers of Commerce

Address Belliardstraat 2 1040 Brussels Belgium

Phone number E-‐mail [email protected] Website http://belgianchambers.be/en/ Tags § International Representation

§ Export The Federation of Belgian Chambers is the overarching organization unifying all Chambers of Commerce in Belgium. More information about how a Chamber of Commerce can assist you in internationalization can be found below under the respective Chambers of Commerce in Flanders (VOKA), Brussels (BECI) and Wallonia (CCI).

Chamber of Commerce, Industry and Agriculture (Belgium, Luxembourg, Africa, Caraiben, Pacific) (CBL-‐ACP)

Address Rue Montoyer 24 / B.5 (3rd floor) B – 1000 Brussels BELGIUM

Phone number +32 2 512 99 50 +32 2 512 81 58

E-‐mail info@cbl-‐acp.be Website http://cbl-‐acp.be/ Tags § Bilateral commercial trade

§ Investment CBL-‐ACP is an institution pursuing two main goals:

1. “the development of a favourable relationship between Belgium & Luxembourg and the countries of Africa, the Caribbean and the Pacific to stimulate industrial, technological, commercial, agricultural and cultural exchanges;”

2. “providing support to all interested parties in Belgium and in the Grand Duchy of Luxembourg looking for opportunities in the countries of Africa, the Caribbean and the Pacific, and vice versa.”


The CBL-‐ACP network “consists of local members of the private sector, well equipped to assist in the prospection, the promotion and on-‐site support of international partnership projects.” With its bilateral sections operating in Brussels, CBL-‐ACP is also the place to learn about trade mission both domestic as well as abroad. Close partnerships have been established with AWEX, BIE and FIT covering all three regions in Belgium. Moreover, the organization has permanent representation in more than 25 countries working closely with their office in Brussels. It’s main aim is to facilitate bilateral partnerships for companies looking to do business or invest in CBL-‐ACP countries.

Belgian Corporation for International Investment (BMI-‐SBI)

Address Avenue de Tervueren 168, bte 9 B-‐1150 Brussels

Phone number +32 2 776 01 00 E-‐mail info@bmi-‐sbi.be Website http://www.bmi-‐sbi.be/en/ Tags § Investment

§ Financing “BMI-‐SBI is a unique semi-‐public finance institution on federal level active in the co-‐financing of business ventures by Belgian private companies abroad. BMI-‐SBI supports projects that are of general economic interest, (to both Belgium and the host country), financially viable and that offer realistic prospects of profitability whilst respecting the principles of social corporate responsibility. In concert with the Belgian company, BMI-‐SBI offers tailor-‐made solutions taking into consideration the particular needs and risk profile of each individual project. As BMI-‐SBI sets out to be a genuine long-‐term partner, it provides comprehensive support as well as cofinancing.” On average BMI-‐SBI investments range from €500.000 to €5.000.000. BMI-‐SBI expects at least an equal contribution by the Belgian industrial partner, projects considered entail a minimum investment of € 1 million. The investments provided by BMI-‐SBI are always tailored made and can exist either out equity, quasi-‐equity or medium-‐ and long-‐term loans. Moreover, BMI-‐SBI investment condition are in line with market conditions. Therefore, before an investment decision is made, they conduct a detailed analysis of the project aimed at assessing not only its eligibility and feasibility, but also the profitability and the repayment prospects. Furthermore, BMI-‐SBI offers foreign investment support to partners engaged in investment projects. These advisory services can also include institutional support to the Belgian promoter in its negotiations with local partners and the arranging of contacts with the local authorities and institutions. BMI-‐SBI operates worldwide, its reach extends to emerging or developing countries as well as to countries in the industrialized world. 27% of its investments are situated within the African continent.


Flanders

Vlaams netwerk van ondernemingen (VOKA)

Address Koningsstraat 154-‐158 1000 Brussel Belgium

Phone number 02 229 81 11 E-‐mail [email protected] Website https://www.voka.be/

Vlaams-‐Brabant Leuven: Tiensevest 170, 3000 Leuven T: +32 (0)16 22 26 89 Vilvoorde: Medialaan 26, 1800 Vilvoorde T: +32 (0)2 255 20 20 [email protected] www.voka.be/vlaams-‐brabant/

West-‐Vlaanderen Kortrijk: President Kennedylaan 9a, 8500 Kortrijk T: +32 (0)56 23 50 51 [email protected] www.voka.be/west-‐vlaanderen/

Limburg Hasselt: Gouverneur Roppesingel 51, 3500 Hasselt T: +32 (0)11 56 02 00 [email protected] www.voka.be/limburg/

Mechelen – Kempen Mechelen: Onze-‐Lieve-‐Vrouwestraat 85, 2800 Mechelen T: +32 (0)15 45 10 20 Kempen: Kleinhoefstraat, 9, 2440 Geel T: +32(0)14 56 30 30 [email protected] https://www.voka.be/mechelen-‐kempen

Oost-‐Vlaanderen Gent: Lammerstraat 18, 9000 Gent T: +32 (0)9 266 14 40 Aalst: Kareelstraat 138, 9300 Aalst T: +32 (0)53 38 22 00 Dendermonde: Noordlaan 21, 9200 Dendermonde T: +32 (0)52 33 98 00 Oudenaarde: Markt 41, 9700 Oudenaarde T: +32 (0)55 39 04 90 [email protected] www.voka.be/oost-‐vlaanderen/

Antwerpen-‐Waasland Antwerpen: Markgravestraat 12, 2000 Antwerpen T: +32 (0)3 232 22 19 Waasland: Kleine Laan 28, 9100 Sint-‐Niklaas T: +32 (0)3 776 34 64 [email protected] www.voka.be/antwerpen-‐waasland/

Tags § International Representation § Export

VOKA is the largest entrepreneurial network of Flanders and represents the interests of companies to the highest level. It’s mission is to create a beneficial framework for successful entrepreneurship for companies in Flanders. VOKA represents 80% of the export in Flanders and Brussels and can thus be seen as a very useful institution of support when a company want to export or, even broader, wants to do business abroad.


VOKA has close ties to the chambers of commerce abroad and can therefore assist you with your international ambitions. Among others, VOKA will assist members with their export documents, organizes workshops and contact moments and represents its members at Flanders Investment and Trade (FIT) and The Belgian Foreign Trade Agency and Federal Public Service Foreign Affairs (BFTA) (ABH-‐ACE). VOKA has a different offer of services and activities per Flemish region (https://www.voka.be/advies/internationaliseren) ranging from a helpdesk focusing on questions about international trade to intensive guidance programs.

Flanders Investment and Trade (FIT)

Address

Antwerpen: Lange Lozanastraat 223, bus 3 2018 Antwerpen Limburg: Corda Campus Hasselt (Corda 4) Kempische Steenweg 305, bus 201 3500 Hasselt Oost-‐Vlaanderen: VAC Gent Koningin Maria-‐Hendrikaplein 70, bus 20 9000 Gent West-‐Vlaanderen: VAC Brugge Koning Albert I-‐laan 1-‐2, bus 21 8000 Brugge Vlaams-‐Brabant: VAC Leuven Diestsepoort 6, bus 21 3000 Leuven

Phone number +32 2 504 87 11 E-‐mail [email protected] Website https://www.flandersinvestmentandtrade.com/export/ Tags § Export

§ Internationalization FIT is an agency of the Flemish Government for promoting trade and commercial exchange FIT has three main tasks:

1. Help companies in Flanders to export and internationalize. 2. Help foreign companies with their investment projects in Flanders. 3. Bring foreign buyers in contact with Flemish products and services.

Within the first task, help companies in Flanders to export and internationalize, it offers expertise in matters like measuring your export capacities, preparing your export plan, discovering new export markets and internationalizing your company.


FINMIX Internationaal FINMIX International is a project of Flanders Investment & Trade (FIT) in collaboration with Agentschap Innoveren & Ondernemen. It is a route counseling -‐ no subsidy -‐ that targets all companies in Flanders, both starters and growers, who are looking for the optimal financing mix for international projects. FINMIX International is open to small, medium and large enterprises, both for starters and growers, who are looking for alternative financing for their international project. No sector is excluded. The target markets of these companies are growth and developing countries (the countries outside the EU-‐28). Moreover, the operating or registered office of the company is located in the Flemish Region. (https://www.vlaio.be/nl/begeleiding-‐advies/financiering/financieringsadvies-‐op-‐maat/finmix-‐internationaal) You can find more info about FINMIX International on the following page: https://www.flandersinvestmentandtrade.com/export/finmix-‐internationaal

Ondernemers Voor Ondernemers (OVO)

Address Willem de Croylaan 58 bus 4022, 3001 Heverlee Belgium

Phone number +32 (0)16 32 10 72 E-‐mail [email protected] Website https://www.ondernemersvoorondernemers.be/wp/nl/ Tags § Entrepreneurship and training

§ Agriculture and food security § Water and sustainable strategy § Health care § CSR § Investment

Ondernemers voor Ondernemers (Entrepreneurs for Entrepreneurs) is a non-‐for-‐profit association which aim is to promote sustainable economic growth in developing countries. To this end OVO -‐ directly or indirectly -‐ brings Belgian companies, entrepreneurs and former entrepreneurs into contact with economic initiatives in the South to support this financially and/or to support with expertise. A North company can get engaged with OVO in 2 different ways:

1. Financial investment The financial support in this case is participation in the capital or a loan. Export / import between both parties is also possible.

2. Expertise The North company can share its knowledge and expertise with the South entrepreneur.

Brussels

Brussels Enterprises Commerce & Industry (BECI)


Address Louizalaan 500 1050 Brussels Belgium

Phone number 02 648 50 02 E-‐mail [email protected] Website https://www.beci.be/nl/ Tags § …

§ … BECI is a partnership between the Chamber of Commerce and the Business Alliance in Brussels. More than 35.000 companies in Brussels are member of the organization. BECI defends the individual and collective interests of the Brussels companies and offers them a wide range of services. Export and internationalization is one of the areas in which Beci supports its members. The e-‐services of Beci assist you in export formalities like consular services, certifications of origin, requesting a ATA-‐carnet and the endorsement of documents. Moreover, as a member of Beci you can freely use the online networking platform be.connected which gives you an in-‐depth overview of possible partners worldwide. A worldwide network of chambers of commerce connects their members via this platform and provide a guarantee of their existence to possible partners. Furthermore, BECI’s department of internationalization will answer your questions and advice you on international matters.

Hub Brussels

Address Brussels Business Support Agency 110-‐112 Chaussée de Charleroi 1060 Brussels

Phone number 02 422 00 20 E-‐mail [email protected] Website http://hub.brussels/en/ Tags § Internationalization

§ Export The newly created organization Hub Brussels is the result of the merger between Atrium.brussels, Brussels Invest & Export and Impulse.brussels. Hub Brussels promotes Brussels exports by helping companies develop in new markets. Within Hub Brussels the department ‘Begeleiding voor Internationalisering’ provides advice and support for companies in Brussels that are looking for internationalization of their companies. The department distributes market information per country, information about export subsidies and provides trainings and coaching about export. SMEs in Brussels looking to export can look for financial assistance with Exportbru (https://www.1819.brussels/nl), residing in the same office as Hub Brussels.

Wallonia Chamber of Commerce and Industry (CCI)

Address

Phone number


E-‐mail Website http://www.cciwallonie.be/

Brabant Wallon Nivelles : Avenue Schuman 101 -‐ Parc d'Affaires "Les Portes de l'Europe", 1400 Nivelles T: +32 (0)67 89 33 33 [email protected] www.ccibw.be/

Hainaut Charleroi : Avenue Général Michel 1c, 6000 Charleroi T: +32 (0)71 32 11 60 Bergen : Boulevard André Delvaux 3 -‐ Parc Initialis, 7000 Mons T: +32 (0)65 22 65 08 [email protected] www.ccih.be

Liege-‐Verviers Namur Luik : Rue Centrale 2, 4000 Liège (Sclessin) T: +32 (0)4 341 91 91 Namen : Chaussée de Wierde 935, 5100 Namur T: +32 (0)81 32 05 50 [email protected] www.ccilvn.be/

Luxembourg Belge Libramont : Grand Rue 1, 6800 Libramont T: +32 (0)61 29 30 40 [email protected] www.ccilb.be/

Wallonie Picarde Doornik : Rue du Folet, 10, bte 003, 7540 Kain T: +32 (0) 69 89 06 89 www.cciwapi.be/ [email protected]

Eupen Malmedy St. Vith Eupen : Herbesthaler Straße 1a, 4700 Eupen T: +32 (0)87 55 59 63 info@ihk-‐eupen.be www.ihk-‐eupen.be/

Tags § … § …

Agence wallonne à l'Exportation et aux Investissements

étrangers (AWEX)

Address Place Sainctelette 2 1080 Brussels Belgium

Phone number +32 2 421 82 11 E-‐mail [email protected] Website https://www.awex.be/ Tags § Export

§ Investment AWEX is the agency for Export and Foreign investments of the Walloon region. Their task is to promote foreign trade of companies based in Wallonia and attract foreign investors to Wallonia. On their website you can find a list of 30 services they or one of their partners offer to Walloon companies looking to internationalize ranging from consultancy support to incubator locations abroad. All these 30 services offered are free of any charge and can be combined. Moreover, the website provides you with an export guide which helps you prepare for exporting. Among other things, it provides you with information on taxation, export risks and the role of the European Union.


Société de Financement de l’Exportation et de

l’Internationalisation des entreprises wallonnes (SOFINEX)

Address Avenue Maurice Destenay 13, B-‐4000 Liège Belgium

Phone number +32(0)4 237 01 69 E-‐mail [email protected] Website http://www.sofinex.be/en/

Tags

§ Export § Investment § Opening branches § International development

SOFINEX encourages exports and investments or the creation of new Walloon companies throughout the world. The companies they assist range from very small or small to medium-‐sized or large companies. The supported projects generate positive spin-‐off for economic activity and employment in Wallonia. They offer 3 products:

1. Financing: Arranging of loans (in various forms), even including a capital shareholding. 2. Guarantee: Granting guarantees to access bank credit more easily. 3. Emergent countries fund: Allocating grants, representing 35% of the value of the

associated goods and services, to make your offers more attractive. Selection criteria:

§ Situation in Wallonia § Ambition for internationalization § Financial solvency § Belonging to eligible sectors

More about the selection criteria can be found through the following link: http://www.sofinex.be/en/criteria/

Belgium in Africa

Honorary Consulate Maputo

Honorary Consul Maria João Rego Costa

Address Avenida Kenneth Kaunda 762 Maputo Mozambique

Phone Number +258 21 492 029


+258 21 492 009 +258 21 492 033

E-‐mail [email protected] [email protected] [email protected]

Website https://southafrica.diplomatie.belgium.be/en/embassy-‐and-‐consulates/honorary-‐consulates/maputo

Tags § Diplomacy

Diplomatic Representation Foreign Trade

Rwandan Representative Jean Pierre Muller

Address Fairway Office Park, Sable House 52 Grosvenor Road Bryanston 2021 (Johannesburg) South-‐Africa

Phone number +27 11 463 03 78

E-‐mail johannesbourg@awex-‐wallonia.com Website Tags § Diplomacy

§ Export § Internationalization

Jean Pierre Muller is the diplomatic representative of the Belgium government for Malawi. He is affiliated with ABH-‐ACE and consequently also with FIT, BIE, AWEX and Hub Brussels.

Europe

Enterprise Europe Network

Address Belgium

Phone number E-‐mail Website https://www.brusselsnetwork.be/

Tags § … § …


International Chamber of Commerce (ICC)

Address Belgium

Phone number E-‐mail Website https://www.iccwbo.be/

Tags § … § …

European Development Finance Insitutions (EDFI)

Address Rue de la Loi 81A B-‐1040 Brussels Belgium

Phone number +32 2 230 23 69 E-‐mail [email protected] Website https://www.edfi.eu/

Tags § … § …

CREDENDO

Address

Phone number E-‐mail Website https://www.credendo.com/

Tags § … § …

Ducroire -‐ Delcredere (Credendo Group) is de Belgische openbare kredietverzekeraar. Hij verzekert ondernemingen en banken tegen politieke en commerciële risico's van internationale handelstransacties die vooral betrekking hebben op kapitaalgoederen, industriële projecten, aannemingswerken en diensten.


Interesting websites for information regarding Mozambique US Government business guide on Mozambique https://www.export.gov/article?id=Mozambique-‐Market-‐Overview Atlas media -‐ Mozambique Country profile https://atlas.media.mit.edu/en/profile/country/moz/ Flanders Investment and Trade – Mozambique country profile https://www.flandersinvestmentandtrade.com/export/landen/mozambique World Bank – Mozambique country profile https://www.worldbank.org/en/country/mozambique/overview World Bank Doing business profile – Mozambique http://www.doingbusiness.org/en/data/exploreeconomies/mozambique

EXCHANGE VZW. – CSP MOZAMBIQUE – 28FEB19

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