FOIL PLANS
Mozambique is the second-largest producer of aluminum in Africa and the 14th in the world. Since 2000, it has been producing aluminum for export, and in 2015 Midal Cables opened a factory near Mozal; the country's largest aluminum smelter. This could be the start of a Mozambican aluminum value chain.
According to the US Geological Survey's Mineral Commodity Summaries of January 2015, Mozambique is ranked 14th among aluminum producing countries worldwide, and second in African continent, after South Africa. During the middle of the 19th Century, aluminum was considered a precious metal, more valuable than gold or silver. Napoleon reserved a prize set of aluminum cutlery for his most distinguished guests, while everyone else at banquets would have to eat with “regular" gold cutlery. In Mozambique, aluminum has played such an important role in the socioeconomic development of the country that it could be still considered the national precious metal.
The Mozal aluminum smelter, located just outside Maputo, was Mozambique's first post-war FDI megaproject, beginning in 1998 and officially opening in 2000. Mozal produces just below 570,000 tons per annum of primary aluminum. The production of Mozal alone constitutes around 7% of the country's GDP. Until now, its aluminum has been almost entirely destined for export, especially Europe. In 2015, however, a new project aimed at supplying the product to the local market may be the start of a new aluminum value chain in the country.
Midal Cables International is a Bahrain-based group that has recently finished a $70 million factory not far from the Mozal plant. Danie Murray, Asset President of Mozal, explained to TBY that the plant has signed an agreement under which it will supply 50,000 tons of aluminum to Midal. “Partnering with Midal will create additional opportunities for the service industry," Murray said. “There is the opportunity to setup manufacturing facilities downstream from Midal's operations to produce a variety of goods from the cable that Midal produces."
TBY also spoke to Orlando Marques, the General Manager of Midal Cables International Lda., who said Midal Cables produced 46,000 metric tons of aluminum rod in Mozambique in 2015. This number is close to their 50,000 tons target, an amount they hope to achieve in 2016. This production, however, is still primarily sold to the international market. In Africa, Midal is currently exporting to Kenya, Nigeria, Uganda, Tanzania, Zambia, Zimbabwe, and South Africa. It also sends products to France, Germany, Italy, Spain, Portugal, and Finland, and recently started to export to Santos, Brazil, and Houston, Texas.
As locals say, if Mozambique wants to take advantage of these foreign direct investments, part of the output should be kept inside the country and used to improve the aluminum value chain, generating wealth for Mozambicans. In terms of demand, Midal expects the local demand increase in 2016, as more industries are developing around the sector and on the way to creating an aluminum segment.
In terms of job generation, manufacturing developments are also key to the country, not only because there are more opportunities available, but also because it is the perfect way to spread knowhow and train the future workers. Midal currently has 120 employees and expects to employ another 80 to 90 in 2016.
Many day-to-day products are made with aluminum, including soda cans, ladders, nails, staples, pots, window frames, gates, and a number of vehicle parts. In fact, the Matchedje Motors plant rolled out its first Mozambican vehicle in September 2014, and Hyundai assembly's plant in Matola, not far from Mozal, has been operating since 2014. These industries and many others could take advantage of having such close access to raw material. If a well-developed value chain was created, aluminum in Mozambique may soon be considered as valuable as it was in the time of Napoleon.
FOIL PLANS
TABLE OF CONTENTS
Review: Economy
Much to Gain
Despite numerous years of considerable economic growth, Mozambique has been unable to retain its wealth and bring more than half of its population out of poverty. Developing one of the world's largest gas reserves and becoming a regional exporter of energy may be the solution.
read articleFocus: Aluminum
Foil Plans
Mozambique is the second-largest producer of aluminum in Africa and the 14th in the world. Since 2000, it has been producing aluminum for export, and in 2015 Midal Cables opened a factory near Mozal; the country's largest aluminum smelter. This could be the start of a Mozambican aluminum value chain.
read articleInterview
Ben James, Managing Director, Baobab Resources
TBY talks to Ben James, Baobab's Managing Director, resident in Mozambique. A geologist by training, Ben has been directly involved with the development of the Company's Tete Project from a greenfields iron ore discovery to an asset on the verge of corner-stoning Mozambique's nascent steel industry.
read articleFocus: Aluminum
Aluminum Legacy
Mozambique is the second-largest producer of aluminum in Africa and the 14th in the world. Since 2000, it has been producing aluminum for export, and in 2015 Midal Cables opened a factory near Mozal; the country's largest aluminum smelter. This could be the start of a Mozambican aluminum value chain.
read articleInterview
Hon. Jorge Olívio Penicela Nhambiu, Minister, Science and Technology, Higher and Technical Vocational Education (MCTESTP)
TBY talks to Hon. Jorge Olívio Penicela Nhambiu, Minister of Science and Technology, Higher and Technical Vocational Education (MCTESTP), on bringing science and technology to rural areas and increasing research in the country.
read articleFocus: E-government + E-bau
Digital Decisions
Between 2015 and 2016, Mozambique fell five positions in the World Bank's Ease of Doing Business Index. The government is investing in the GovNET and e-BAU platforms to facilitate procedures and cut the costs of acquiring business licenses and improving services provided to the public.
read articleReview: Health
Time for a check-up
Mozambique's healthcare budget rose to $561.5 million in 2015, an increase of 1.1% on expenditure in 2014, accounting for 10.2% of the state budget. Total healthcare expenditure in 2014 was $477.5 million. The Ministry for Health oversees the sector and is responsible for setting the budget each year.
read articleInterview
Dr. João M. Carvalho Fumane, Director General , Hospital Central de Maputo (HCM)
TBY talks to Dr. João M. Carvalho Fumane, Director General of Hospital Central de Maputo (HCM), about the range of services on offer and what is being done to further excellence in the health sector
read articleInterview
Hon. Jorge Ferrão, Minister, Education and Human Development
<span style="line-height: 1.6em; background-color: initial;">TBY talks to Hon. Jorge Ferrão, Minister of Education and Human Development, on the goals of the ministry, the role of local languages, and tackling teacher absenteeism.</span>
read articleInterview
Prof. Doctor João Leopoldo da Costa, Rector, Instituto Superior de Ciências e Tecnologia de Moçambique (ISCTEM)
TBY talks to Prof. Doctor João Leopoldo da Costa, Rector of Instituto Superior de Ciências e Tecnologia de Moçambique (ISCTEM), on the perils of the internet on education and the quality of its high school.
read articleReview: Tourism
Mozambeach
With white-sand beaches, scuba diving, and game reserves among its wide range of accommodation, Mozambique is a goldmine for tourism. However, to attract the number of tourists the country is aiming for, and entitled to, it will have to compete with its considerably more popular neighbors.
read articleReview: Legal
Smart Choices
Foreign investments are sources of capital, foreign exchange, and technical know-how for developing countries such as Mozambique. Over the past three decades, Mozambique has been successfully striving to ensure a favorable legal framework for foreign private investment.
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