APA – Maputo (Mozambique) – The aim is to finance the implementation of Mozambique’s Economic Acceleration and Governance Support Programme.
The African Development Fund, the concessional lending arm of the African Development Bank (AfDB) Group, wants to improve the business environment in Mozambique and stimulate investment in climate-smart agriculture.
Its Board of Directors has approved a grant of $19.98 million to this end. “This financing is the first of two successive operations to support the general budget for the 2023 and 2024 financial years, each worth around 20 million dollars,” states a press release received by APA. The programme, adds the document, will support reforms in two main areas, namely improving the enabling environment for the private sector for economic recovery and green growth, and strengthening the efficiency, accountability and transparency of public spending.
“It will enable Mozambique to streamline the regulatory framework and investment facilitation processes that promote private sector development and attract investment in climate-smart agriculture. It is expected to help stimulate the development of agribusiness and micro, small and medium-sized enterprises, as well as finance efforts to integrate gender and climate action initiatives into economic development. It will also strengthen public financial management, in particular internal controls, public procurement and debt management functions,” the press release points out.
The programme supports a number of reform measures. These include obtaining the Mozambican government’s approval of the Agricultural Development Strategy (2030) and Investment Plan (2022-2026); a new cashew law designed to strengthen the legislative regime for the cashew nut value chain by adapting it to the current requirements of national and international markets; a new law to strengthen support for micro, small and medium enterprises, including tax incentives; and a revised draft investment law that introduces provisions to promote responsible investment practices, streamline investment processes, provide protection against expropriation.
“The programme has a strong focus on private sector development, with particular emphasis on strengthening private sector participation in key sectors, especially agro-industry, and a high potential for job creation, including for women and youth, and is therefore expected to have a positive impact on Mozambique’s socio-economic development,” said Leila Mokaddem, Managing Director of the AfDB’s Regional Development and Service Delivery Office for Southern Africa.
At the end of July 2023, the document received by APA indicates, the active portfolio of the African Development Bank Group in Mozambique amounted to 1.19 billion dollars. Investments cover the energy (48.8 percent), transport (32.6 percent), agriculture (16.8 percent) and social (1.6 percent) sectors, as well as multi-sector operations (0.2 percent).