Mozambique has a lot of available arable land despite “impressive” increase in cultivated area

26 January 2012

London, United Kingdom, 26 Jan – The amount of cultivated land in Mozambique has increased by 47 percent in the last decade, an “impressive” rate according to the Economist Intelligence Unit, but the amount of available arable land is still being under-used due to a lack of infrastructure and investment capacity.

Figures from the latest agricultural census in the country showed that in 2009-2010 the total cultivated area was 47 percent more than recorded a decade earlier, which was a growth rate of almost twice that of the population.

In its latest report on Mozambique, published in January, the EIU also noted that the total number of agricultural units had grown less that the cultivated area – by 25 percent – showing an increase in size of each production unit.

“Despite such impressive growth, Mozambique still has a large surplus of land,” and just 15.6 percent of potential farm land is being used, the EIU said.

Behind this lack of use of available land, it said, is the “lack of investment in agricultural infrastructure, such as roads, irrigation and storage units.”

According to the EIU, another obstacle is the Mozambican system of renting State–owned land to farmers, which prevents them from using this asset as a guarantee to get bank loans.

In the last Mozambican state budget agriculture was set as a priority sector, with 11.6 percent of total expenditure in 2012 earmarked for it.

The Mozambican government plans to invest, over the next 10 years, around US$540 million in irrigation as a way of driving agricultural production and productivity in the country.

A programme of agricultural registration is also underway to identify areas with agricultural potential and allow for better planning for land use.

In order to increase the self-sufficiency of the country and farmers’ revenues, encouraging production of surpluses, the government is supported by China, Brazil and the European Union.

According to the EIU, the rise in agricultural production, alongside the drop in food prices on an international level, is expected to lead inflation to drop to an average of 6.5 percent over the next few years.

The EIU expects Mozambican economic growth to speed up, from 7.2 percent in 2011 to 8 percent this year and 8.5 percent next year, then slowing to 7.5 percent in 2015.

Economic growth will be bolstered by expansion of the mining industry, particularly coal, but projections are also conditional upon continuing international investment levels, which are somewhat uncertain due to a negative outlook for developed economies. (macauhub)