Mozambique provides “important investment opportunities in any sectors,” ranging from infrastructure to tourism and energy, according to the latest Guide to Business and Investment in the country.
Published by law firm Cuatrecasas, Gonçalves Pereira, in partnership with another law firm, Couto Graça e Associados, the guide covers investment laws, labour relations, public-private partnerships as well as specific regimes for sectors such as energy, mines, and oil and gas.
“Endowed with rich and vast natural resources, such as the sea and rivers, gas, coal, minerals, wood and extensive tracts of agricultural land, the Mozambican economy is increasingly based on industry with particular focus on oil and mining,” the guide says.
Until very recently, it notes, the Mozambican economy was based, “essentially on agriculture.”
Benefiting from the robustness of the extractive industries and on manufacturing until the beginning of the fourth quarter, economic growth projections for Mozambique were increased, both internally and externally.
According to official Mozambican statistics, economic growth increased in the second quarter to 8 percent or 1.7 percentage points more than in the same period of last year despite a global downturn, which affected some important trade partners.
The International Monetary Fund (IMF) raised its projection for Mozambique’s economic growth, from 6.7 percent to 7.5 percent, and its forecast is now in line with that of the government of 8.4 percent next year.
The Economist Intelligence Unit (EIU) raised its projection for growth to 7.4 percent, or 20 percentage points higher than its previous projection of 7.2 percent.
The document also says that the biggest international partner and source of investment for Mozambique is South Africa, closely followed by the United Kingdom.
“Portuguese investment also has a strong presence in the Mozambican economy and showing a growth trend,” it says.
The guide also points to a positive outlook for growth of the Mozambican economy and a drop in inflation.
Measured by annual price changes in the city of Maputo, average annual inflation in November stood at 7.74 percent, as compared to around 16 percent back in 2010.
The drop, the guide says, is amongst other tings due to a greater internal supply of national products such as fruit and vegetables and “a greater confidence of economic agents in the Mozambican economy.”
The legal framework that applies to foreign and national investments is included in the Investment Law, its Regulations and the Tax Benefits Code.
Foreign and national private investments are offered a number of benefits, including corporate tax (IRPC) breaks and customs tariff exemptions on imports.
The minimum amount of foreign direct investment (FDI) that is eligible for these benefits is 2.5 million meticals (US$93,000).
The Centre for Investment Promotion (CPI) provides a general investment guide on its website. (macauhub)