All development policies in Mozambique are focused on two major issues: poverty reduction and social and economic infrastructure development. This was recently affirmed by the Rector of Mozambique’s Higher Institute of International Relations, Dr Patricio José. Regarding poverty alleviation, the aim is to achieve a minimum standard of living for the country’s people, including adequate nutrition, access to utilities such as electricity and basic education. Infrastructure development includes schools and hospitals as well as roads and railways.

“In addition, we aim to promote good relations with the outside world and the region to ensure a friendly outside environment that would promote internal development,” he added. Efforts are also being made to improve physical links with neighbouring countries and strengthen north–south communications within the country. These include the construction of a number of bridges, notably over the Zambesi river.

Apart from developments in the mining and hydrcarbons sectors, currently, ports and railways are being developed or rehabilitated. The fishing industry is being developed. “We are encouraging business, including small businesses,” he noted. Outside mining and oil and gas, the country’s main investment focus areas include agriculture, fisheries, tourism, education (including universities), transport, commercial and residential property.

“We feel that the country is moving,” stated José. “But there are contradictions. As we develop, our population is increasing. So the social pressures are increasing. We need more schools, colleges and universities. We need people to start farming scientifically. We need to produce food. We lost skills during the Civil War.” (The Civil War raged from 1976 to 1992 and followed on from the War of Independence, against Portugal, which was fought from 1964 to 1974.)

“The government’s approach is: let’s facilitate, let’s create a business friendly environment,” he reported. “But we always recommend that foreign investors partner with Mozambicans. In part, this is to facilitate inter-cultural relations, so as to reduce conflicts, avoid damaging the business and get profits. In part, this is to transfer knowledge to Mozambicans and create a skilled workforce and local suppliers.

“The attitude of the investor towards the local community, the local people, is a tool for success,” he stated. “We think this can be done to enable foreign business in the country.” José participated in Frontier Advisory’s recent Frontier Forum on the Economic Outlook for Mozambique, in Sandton.

At the same event, Dr Nicolau Sululo, Economic and Trade Counsellor at the Mozambique High Commission in Pretoria, highlighted that his country enjoyed macroeconomic stability and had one of the ten fastest-growing economies in the world. With a population of 24.366-million last year and a population growth rate of 2.8%, the country had an unemployment rate of 17%. Nominal gross domestic product (GDP) was $15.355-billion and GDP per capita was $630. In 2011, the country’s exports were valued at $3.6-billion, while imports came to $6.3-billion. Although Mozambique ranked 127 (out of 189) in the latest World Bank Ease of Doing Business Index, this represented a climb of 15 places over the country’s 142nd position in the previous index.

“Mozambique has preferential access to the Southern African Development Community, the US, the European Union, China and India,” he pointed out. “Public–private partnerships are encouraged. “There are no restrictions on loans and payment of interest abroad.” Dividends can also be transferred abroad and the country accepts arbitration by the International Centre for the Settlement of Investment Disputes and by the International Chamber of Commerce. Mozambique also has bilateral investment promotion and reciprocal protection treaties with a number of leading countries, including South Africa.