1998 SOUTHERN AFRICA ECONOMIC ... - National Treasury

M O Z A M B IQ U E
Trade Liberalisation
I m p o rts up to the value of USD500 may be brought into
Mozambique without a license, p rovided that tied-aid funds are
not the method of finance used. All other imports have to be
re g i s t e red with the Ministry of Commerce and fo reign curre n c y
must be secured through negotiation with commercial banks.
All exports need to be re g i s t e red with the Ministry of
C o m m e rce for statistical and balance-of-payments purposes.
E x p o rters are allowed to retain their fo reign currency earnings
in fo reign currency accounts.
Fo reign Direct Inve s t m e n t
Mozambique is experiencing a boom in FDI. During the past 13
years Mozambique has re c e i ved fo reign investments to a total
amount of USD1,040m.A number of large projects in more or
less advanced stages are in the pipeline for 1998-2000.
The main investing countries are Po rt u g a l ,South Africa and the
U K .
The Enron - Pande natural gas project is in an advanced stage
of preparation where feasibility studies have been presented to
the Mozambican authorities. The project consists of gas
e x p l o i t a t i o n ,a pipe line to Maputo and to supply customers in
South A f r i c a ,and the construction of an integrated iron and
steel plant in Map u t o. Construction of the former is expected
to take 20 months and the latter 42 months. Total estimated
amounts for the project amount to USD 470m in year 1,
USD670m in year 2, USD690m in year 3 and USD230m the
fo u rth and final ye a r.The iron and steel plant project grew out
of a need for Enron to find a major customer for its natural
gas re s e rves at Pande. E n ron and the Industrial Deve l o p m e n t
Corporation of South Africa are curre n t ly seeking financiers
for the pro j e c t .
Other large projects include Moatize coal mine where South
African JCI and Austral coal have development options, fo r
which they will sign a joint technical programme in the near
f u t u re. The projected investment is USD1,300m and the
p resent plans include production and export amounting to 7 m
Top five countries investing in Mozambique 1993-1997, USD m
O r i g i n 1 9 9 3 1 9 9 4 1 9 9 5 1 9 9 6 1 9 9 7
N o Value N o Va l u e N o Va l u e N o Va l u e N o Va l u e
South A f r i c a 1 4 1 0 . 9 2 0 2 1 . 7 1 7 1 8 . 6 2 7 4 . 6 2 3 6 6 9 . 0
Po rt u g a l 5 0 . 8 2 7 3 7 . 3 2 5 6 . 7 4 2 1 6 . 5 3 8 1 4 . 6
U K 4 1 . 5 6 4 . 5 5 3 . 0 6 8 . 0 9 1 . 9
Hong Ko n g 0 0 0 0 1 0 2 2 5 . 5 0 0
U S A 1 0 1 0 . 7 0 0 2 1 4 . 6 3 1 . 0
To t a l 2 4 1 3 . 2 5 4 6 4 . 2 4 8 2 8 . 3 7 9 6 9 . 2 7 3 6 8 6 . 4
S o u rc e :C e n t ro de Promoçao do Inve s t i m e n t o s ,M aputo (1998)
N o t e :Two of the South African projects above have been cancelled, the value of these was USD1.5m.
Some new ve n t u res have been pioneered re c e n t ly thro u g h
a g reements between the Heads of State of Mozambique and
South A f r i c a ,and Mozambique and Mauritius re s p e c t i ve ly. T h e
fo r m e r, “ M o z a g r i n s ” , re g a rds commercial agricultural joint
ve n t u res in the Niassa province between farmers from the two
c o u n t r i e s ,and the latter invo l ves rehabilitation of the sugar
i n d u s t ry in the Beira are a .
Large projects that are taking shape include the construction of
an aluminium smelter outside Map u t o, “ M o z a l ”.
T h e
construction is expected to start during 1998, with an annu a l
i nvestment projection for the project period 1998 - 2000
amounting to ap p rox i m a t e ly USD430 m. The project is financed
f rom a number of sources including Gencor/Billiton, IDC of
South A f r i c a , quasi-equity amounting to USD150m from IFC,
CDC and others, fo reign sources re p resenting USD650m. T h e
Mozambican government will retain 4 percent of the pro j e c t
t h rough an EIB loan. It is expected that the project will employ
a round 5,000 people during its peak construction, and about
900 people, 800 of which would be Mozambicans, once it is
o p e r a t i o n a l .
tonnes per annu m . The plans include new large open cast pits
at Moatize, a large capacity washing plant, rehabilitation of the
r a i lw ay to Beira and new coal handling facilities in Beira port . J C I
also had plans to produce hot briquetted iron in Beira. T h e
p ro j e c t ,which includes the construction of a new terminal in the
Beira port amounts to USD620m and was scheduled to
commence during 1998, with production starting in 2001. D u e
to the difficulties experienced by JCI lately the project has been
put on hold.
M aputo Development Corr i d o r
The Maputo Development Corridor re p resents one of the most
ambitious and compre h e n s i ve regional investment projects in
Southern Africa to date. The project was officially ap p roved in
August 1995 at a meeting of the re s p e c t i ve Ministers of
Tr a n s p o rt of Mozambique and South A f r i c a . The project is
c e n t red around the rehabilitation of infrastructure (ro a d , r a i l ,
p o rt and border post). S e c o n d ly, the project aims at maximising
i nvestment in related ve n t u res that would benefit from the
rev i ved corr i d o r.Together with the additional investments in the
c o rridor the project is expected to attract a total of
USD5,000m over the next 10 ye a r s .
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