doing business in mozambique 2011
DESCRIPTION
Mozambique's economy grew 6.5% last year, making it one of the best performers in sub-Saharan Africa and growth is expected to continue to accelerate. This presentation is about opportunities and challenges of doing business in Mozambique.TRANSCRIPT
Mozambique UncoveredTHE ROLE OF CPI AND AN OVERVIEW OF BUSINESS
OPPORTUNITIES
Mandate:
• To promote the attraction of national and foreign direct
investment;
• To provide institutional assistance to investors;
• To receive and register investment projects;
• To guarantee the concession of fiscal and customs incentives
to investors;
CPI- Investment Promotion Centre
INVESTMENT PROMOTION, FACILITATION AND AFTERCARE
Mandate:
• To promote business linkages between national and foreign
companies, SME’s and large undertakings;
• To identify potential financial and/or technological partners
for joint ventures;
• To identify and disseminate investment opportunities;
• To promote programmes of assistance to the development of
businesses, in particular national businesses.
CPI - Investment Promotion Centre
Investment Policy (Legal Framework):
– Investment Law;
–Regulation on Investment Law (new);
–Code of Fiscal Benefits (new).
Law on Investments
• Guarantees:– Legal protection of property, goods and industrial
property rights;– Unrestricted import and repayment of loans, equity,
royalties and compensation proceeds;– Free repatriation of dividends (100%);– Equitable compensation in case of expropriation or
nationalization;– Arbitration through ICC or ICSID for dispute
resolution;
Regulation on Investment Law(FDI minimum requirements for eligibility for external remittance of profits and invested
capital)
• Minimum value of Foreign Direct Investment: US$ 100.000; or
• Generates annual sales not less than US$ 300.000; or
• Registers annual exports of goods or services not less than US$ 50.000; or
• Creates and maintains at least 25 direct employment positions for Mozambicans (From 2nd year of operations).
Taxation System
Customs Duties on Imports– Equipment
5.0%– Raw material 2.5%– Semi-processed goods 7.5%– Finished goods 20.0%
VAT 17.0%
Corporate tax - General 32.0%
Personal Tax– Minimum 10.0%– Maximum 32.0%
Withholding tax 20.0%
General Incentives
Exemption from payment of customs duties and VAT on the import of equipment classified as class “K” in the Customs Tariff Schedule including the accompanying spare and accessory parts
Tax Credit– Maputo City 5%– Other Provinces 10%
Accelerated depreciation legal rates + 50%
Professional training deducted from taxable income
Other incentives
Creation of Basic Infrastructures
Trade and Industry in Rural Areas
Manufacturing & Assembly Industry
Agriculture and Fisheries
Hotels and Tourism
Science and Technology Parks
Large Scale Projects
Rapid Development Zones
Industrial Free Zones
Special Economic Zones
Specific Benefits
Bilateral Treaties & Agreements
Investment Promotion and Reciprocal Protection Agreements:
South Africa, Germany, Algeria, Belgium, China, Cuba, Denmark, Egypt, USA,
USA (OPIC), Finland, France, Indonesia, Italy, Mauritius, Netherlands,
Portugal, Sweden, United Kingdom, Vietnam, India, Switzerland,
Zimbabwe and Spain.
Agreements to prevent Double Taxation and Fiscal Evasion:
Portugal, Mauritius, United Arab Emirates, the Autonomous and Special
Administrative Region of Macau, Italy and South Africa, .
Rank Country Projects FDI (US$)
1 South Africa 27 64,697,247
2 Portugal 17 33,590,163
3 Mauritius 5 30,322,693
4 United Kingdom 7 28,795,000
5 United Arab Emirates 4 23,292,589
6 China 3 7,250,000
7 Pakistan 1 5,000,000
8 India 4 3,092,500
9 Swaziland 2 1,680,878
10 Brazil 2 1,595,975
TOTAL 199,317,645
Top 10 Investor First Half, 2011
Main Investment Opportunities
MiningMining
Financial Services
Agri-Business Agri-Business
InfrastructureInfrastructure
IndustryIndustry&&
TradeTrade
Agri- Business
Land
Land is a State owned asset and
may not be sold, mortgaged and
pledged
Maximum length of a concession
is 50 years, renewable for
further 50 years
Annual Fee (per hectare):Cattle Farming MT 5.00
Agriculture MT 37.50Other activities MT500.00(Exchange rate: US$ 1 ~ MZM 28.00
Huge untapped potential
36 million hectares of arable land, only about 14% currently cultivated;
3.3 million hectares of irrigable land, with approx. 50.000 ha (0,13%) currently irrigated;
70% of total surface covered by forests of different species (49% having a proved commercial value);
9 million hectares of national parks and reserves;Agro-ecologies suitable for food, feed, fiber and
bioenergy production
Agriculture & Agro-processing
Food Production
Maize, rice, barley; Soybean, sesame, peanuts, beans, sunflower; Sugar; Bananas, citrus Tea, coffee;
Production of bio-fuels
Wood Industry
Paper
Infra-structureInfra-structure
DEVELOPMENT CORRIDORS
Maputo Development Corridor Limpopo Development Corridor
Massangena Development Corridor Dondo Development Corridor
Beira Development Corridor
Mutuali Development Corridor
Cuamba Development CorridorLichinga Development Corridor
Nacala Development Corridor
Mueda Development Corridor
Sena Development Corridor
MAPUTO
RICHARDS BAY
DURBAN
BEIRA
Quelimane
NACALA
HARARE
JOHANNESBURG
PRETORIA
GABARONE
Livingstone
LUSAKA
Ndola
LUMBAMBASHI
Pemba
Mocimboa da Praia
Mtwara
BLANTYRE
LILONGWE
Tete
Mutare
Pietersburg
Nelspruit
MBABANE
MASERUBloemfontein
EAST LONDON
PORT ELIZABETH
Lobatse
Inhambane
Bulawayo
INFRASTRUCTURES FOR INFRASTRUCTURES FOR INTEGRATIONINTEGRATION::
Ports and AirportsPorts and Airports
Maritime, Rail, Roads, Maritime, Rail, Roads, Rivers and air transport Rivers and air transport systemssystems
Energy Energy
Synergies and sustainabilitySynergies and sustainability
Strategic Investments:Strategic Investments: Agriculture, Tourism, Mineral Agriculture, Tourism, Mineral resources, etcresources, etc. .
DEVELOPMENT CORRIDORS
SADC Transport Corridors
Mozambique has a political and social stability that reflects on good governance, quality of institutions, openness and good attitude towards FDI;
The Country protects against property expropriation, and guarantees non-discriminatory treatment between foreign and domestic investors;
Stable Investment Legislation (Predictable, Consistent and Transparent);
100% of investment ownership and control;
Absence of minimum capital requirements;
Market based economy.
Why Investing in Mozambique?
Sound and Efficient Institutions;
Good and Stable Macroeconomic Enviroment: Fast-Growing Economy: 7.5% Average GDP growth in the last decade ;
Infrastructure under massive improvement: Transport infrastructure, Ports and “Development Corridors” serving landlocked neighboring states:
Development and operation of new/rehabilitated port facilities;
Incremental Power Generation and Transmission investments;
Mozambique’s Competitive Advantages