STEP FORWARD

Mozambique 2016 | ECONOMY | INTERVIEW

TBY talks to Lourenço Sambo, Director General of Investment Promotion Centre (CPI), on cutting back on red tape, attracting FDI, and the booming agricultural sector.

Lourenço Sambo
BIOGRAPHY
Lourenço Sambo has an educational background in economics and agricultural business management, and has been the Director General of CPI since 2010. He was previously the Economic Adviser to the Minister of Planning and Development. He also taught mathematics at Maxaquene Secondary School, politics, economics, mathematics, and statistics at the Maputo Commercial School from 1979 to 1984, and public finance at the School of the National Planning Commission. In 1996, he was the Financial Manager of the Maputo Corridor, a World Bank-funded project for the restructuring of CFM-Mozambique Ports and Railway Company.

How much progress has Mozambique made in the past five years in terms of improving the ease of doing business?

By various metrics, including the World Bank's Doing Business report, Mozambique has made tremendous progress. In Doing Business 2015, Mozambique climbed 15 steps compared to 2014, bringing the country to 127th position, in contrast with the 142nd place it occupied in the previous year. The World Bank highlights progress in areas such as property registration, availability of credit, and resolving insolvency as areas with the most significant improvement. The process of company incorporation has been simplified over the years. Today, you can complete all the necessary steps in a matter of just a few days provided that the investor presents all the required documentation. It is far simpler today than it was 10 years ago.

What is CPI's strategy to attract medium-sized international businesses?

Large projects play a major role in Mozambique's economy by boosting national production and exports and by creating jobs, both directly and indirectly. Indirect jobs appear as a consequence of many small and medium-scale enterprises that emerge as suppliers of goods and services for these megaprojects. CPI will continue to play a role to attract and, more importantly, retain private investment in Mozambique through various platforms. We also provide institutional assistance to investors from project inception to implementation. Substantial fiscal incentives are also provided under the Investment Law for investors. The government has also established special economic zones throughout the country where investors can enjoy special fiscal benefits. These zones include the Beluluane Industrial Park, home to one of the largest aluminum smelters in the southern African region (MOZAL), Beira Mungassa in the central province of Sofala, and the Nacala Special Economic Zone in the northern province of Nampula. We also have what we call rapid development zones for investments in agriculture, agro-industry, industry, tourism, lumbering, and other sectors that, according to feasibility studies, can bring high returns.

What can be done to transform the agricultural sector from subsistence farming to a more efficient and productive agro-industry?

Agriculture is one of the most important sectors in Mozambique due to its potential in terms of a tropical climate, abundant and competitive labor, and availability of arable land—currently estimated at 35 million hectares. Agriculture has had major impact in the economy through the production of various cash crops such as cotton, tobacco, sugar cane, soy beans, and others, as well as strategic food crops such as maize, rice, and different vegetables and fruits. We need more investment in order to boost this strategic sector of the economy, which is also the source of livelihood for about 80% of our population. We need to attract commercial farmers from our region and from other parts of the world who can involve and employ subsistence farmers through various mutually beneficial schemes. The local population is provided with adequate inputs such as tools, seeds, and fertilizers. In fact, Mozambique alone could feed the SADC region and Africa at large with the crops that are unique to the country.

What are CPI's goals and expectations for the year ahead?

We expect more investment at levels much higher than last year, as well as the implementation of a large number of projects approved in areas such as logistics, mineral resources, and energy. In 2014 alone, we approved 500 projects with a total value of $7 billion. We also expect to have more Mozambicans trained in different strategic areas, such as oil and gas, geology, and mining some of the sectors where we still lack human capital. We hope to expand our presence within the country and abroad to further facilitate the investment approval processes. We also hope to see collaborations with the different institutions involved in the process of investment project approval so that the process can be much faster.