Mozambique is situated on the south-eastern coast of Africa. It borders Tanzania to the north, Zambia, Malawi and Zimbabwe to the west and South Africa and Swaziland to the south. This location puts the country in a strategic position in the Southern African region with its ports giving easy access to international markets and being the first choice for regional importers and exporters. Mozambique is an attractive destination for investments.  In this article you will find an overview of investment opportunities, as provided by the Mozambique Investment and Export Promotion Agency (APIEX).

The Mozambican economy has registered remarkable growth in the last decade benefitting from substantial inflows of foreign direct investment (FDI) into various sectors, notably agriculture and agro-industry, tourism, infrastructure development, energy, fisheries and aquaculture, industry, mineral resources (mainly coal and gas) and banking, among others.

Mozambique has Membership Agreements with of the ICSID, MIGA and ICC and a signatory to bilateral investment promotion and protection agreements with many countries around the globe including China, South Africa, Germany, Algeria, Belgium, Botswana, Cuba, Denmark, Egypt, USA, USA (OPIC), Finland, France, Indonesia, Italy, Mauritius, the Netherlands, Portugal, Sweden, United Kingdom (UK), Vietnam, Zimbabwe, India, Spain, Switzerland, Japan, Brazil, Singapore and Turkey.

WHY INVEST IN MOZAMBIQUE?

Mozambique has both comparative and competitive advantages, which are supplemented with good governance.

• Strategic location (as a gateway to the Southern African Development Community, SADC): Providing infrastructure that gives access to land-locked SADC countries (ports, railways, pipelines and roads);
• Rich and diverse natural resources: Vast land reserves, mineral resources, water and a diverse cultural and historical heritage;
• Abundant labor force: availability of a competitive, educated and easily trainable labor force;
• Sustainable economic growth: Mozambique is expected to grow in average around 7% every year from 2022, as a result of the LNG Projects and will be one of the fastest growing economies in the Sub-Saharan Africa for years to come.
• Increased investment into infrastructure: infrastructure development is one of the country’s top priorities and public-private partnerships are encouraged.

INVESTMENT PRIORITY SECTORS

AGRICULTURE

Mozambique has tropical to sub-tropical climate with fertile soil, ample rainfall, 36 million hectares of arable land, mostly unutilized and irrigable area estimated at about 3.0 million hectares, eight river basins considered the most favorable for the development of irrigation, Maputo, Limpopo, Búzi, Zambezi, Licungo, Melúli, Lúrio and Rovuma.

Mozambique identified 15 strategic value chains with greatest opportunities: maize, rice, potatoes, beans, cassava, poultry, meat, sweet potatoes, vegetables, banana, sugar, sesame, soy, cotton, cashew-nut, macadamia and paprika.

INDUSTRY

The Government has assigned the role of economic driver by transforming and adding value to the country’s abundant natural resources and thus promoting the diversification and expansion of the supply of locally produced goods and services and, consequently, stimulating exports and substituting imports.

Investment opportunities almost all over the country food and agro-processing, packaging and printing, wood processing, textile and apparel, building materials, sanitary were, furniture and metals and metallurgical.

TOURISM

Unique investment opportunities in national parks and reserves, the possibility of investment in private game farms in the interior of the country, benefiting from fauna and flora, combined with beach tourism along the 2700 km coast and on islands and archipelagos.

The Government identified specific areas and protect by law for integrated tourism development: Inhassoro Integrated Resort; Pemba Integrated Resort (east coast and Pemba); Pemba Marina; Business Hotel in Pemba, Inhassoro Hotel; Crusse Jamali Integrated Resort.

ENERGY

Mozambique is endowed with an enormous and diversified energy resource base, most of which remains untapped. Nevertheless, as a result of recent developments, the country is expected to emerge as the 3rd largest exporter of LNG (liquefied natural gas) in the world, once the necessary investments have been fully made. It includes: (i) Exploitation of the 23 billion tons of coal reserve potential; (ii) Exploitation of more than 200 TCF natural gas reserves; (iii) Exploitation of more than 23TW of renewable energy potential.

INFRASTRUCTURES

The Government investing in the development of public infrastructures, namely roads, bridges, telecommunications, among other sectors in partnership with the private sector. Public-private partnership is encouraged by the Government.

INVESTMENT INCENTIVES

The code of fiscal benefits grants tax and customs benefits depending on the amount, location and sector of investment activity. The current incentive schemes are:

• Generic Fiscal and Customs Benefits: Investments carried out under the Investment Law are exempt from payment of customs duties and VAT on import of capital goods and their accompanying parts and accessories classified as Class K of the Customs Tariff.
• Tax Credit per Investment: Investments carried out in Maputo City benefit, for a period of five tax years, from a deduction (not to exceed the tax payable in respect of the investment project activity) from Corporate Income Tax (IRPC) that is equal to 5% of the total investment realized.

The percentage is 10% in all other remaining provinces. In addition, there are specific regimes for:

• Agriculture and Fisheries;
• Trade in Rural Areas;
• Manufacturing and Assembly Industry;
• Creation of Basic Infrastructure;
• Industrial Free Zones;
• Tourism and Hospitality;
• Large Scale Projects.