Business climate in Mozambique worsens this year

24 September 2010

Maputo, Mozambique, 24 Sept – The Mozambican business climate worsened this year against 2009, due to issues of governance that led the capital, Maputo being considered the worst place to do business, according to a study by KPMG published Wednesday in Maputo.

The study showed that the 2010 Business Climate index in Mozambique fell by 4.3 percentage points to 101.5 percent, as compared to 2009, but has risen 1,5 percentage points since 2005, the base year for calculation of the index.

“The main factors with the highest index are related to infrastructure and services (112.4 percent),” specifically, “communications, water supply, energy and air transport,” it said.

However, KPMG noted, “acts of governance and governments, namely in terms of criminality, organised crime, corruption and excessive bureaucracy in providing public services,” are pointed to as, “the principal factors that contributed to the deterioration of the business climate in 2010.”

“The crime rate influences the structure and costs of companies, not only due to a loss of equipment and products due to theft or robberies, but also as a reflection of costs with hiring security companies and the acquisition of appropriate protection equipment,” the auditing company said.

The province of Niassa, in the north of the country, had the best business index, at 115.8 percent, after being placed second to last in 2009, whilst Maputo, the Mozambican capital, in the south, is the area with the worst performance, with 94.7 percent.

The survey for the Business Climate Index is carried out each year and is the result of a partnership between KPMG Moçambique, the Confederation of Economic Associations and the Mozambique-South Africa Chamber of Commerce and Industry. (macauhub)