centro de promoção de investimentos main characteristics of the investment climate mozambique...

Centro de Promoção de Investimentos

Main Characteristics of the Main Characteristics of the Investment ClimateInvestment Climate

MozambiqueMozambique

Paris

03 OCT 2003


CPI offers a package of services and support to local and foreign investors who wish to invest in

Mozambique.

www.mozbusiness.gov.mzwww.mozbusiness.gov.mz


Population: 17.2 million

Bordering 6 Countries

Area: 799,380 Km2

2700 km of coast

Urbanisation Rate: 29%

Over 60 Rivers and Lakes

Official Language: Portuguese

English is Widely Spoken

Facts & FiguresFacts & Figures


Foreign Trade***

Exports US$ 703 million

Imports US$ 1 063 million

***) - INE 2002.

Statistics, utilities and servicesStatistics, utilities and services


Main Export Products

Aluminium,Tobacco,Citrus,Coal,Electricity,Cashew nuts, prawns, lobsters, cotton and wood.

Main Import Products

Transport & electrical equipment, machinery,food products, petroleum products and cereals.



Main Export Markets

Spain, South Africa, USA, Japan, Portugal, Malawi,Zimbabwe,India, U.K.

Main Import origins

South Africa, Portugal, USA, Japan, India e France



Statistics, Utilities And Statistics, Utilities And ServicesServices

Macroeconomic Indicators

GDP (1996 constant prices)

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

1996 1997 1998 1999 2000 2001 2002

Years

10E

3 M

T

GDP (1996 constant prices)

Centro de Promoção de InvestimentosStatistics, Utilities And ServicesStatistics, Utilities And Services

Macroeconomic Indicators

Exchange rate

0

5,000

10,000

15,000

20,000

25,000

1996 1997 1998 1999 2000 2001 2002

Years

US

D/M

ZM


• Economic growth in Africa was dismal in 2002 (at 3.2 %)

– The best performers were Mozambique, Rwanda and Uganda,

• whose economies grew by 12%, 9.9% and 6.2% respectively

– Mozambique managed to attract $518m in FDI in 2001

– In the past decade, Mozambican incomes have nearly doubled.


• Known as the "gateway to Southern Africa”

– Macro-economic stability and a political environment conducive to investment.

– Massive rehabilitation programme of port and other infra-structural facilities

– No exchange controls on the repatriation of profits

– Ability to hold foreign currency accounts – Established Export Processing Zones – A large and dedicated labour force available at

highly competitive rates


Countries FDI in USD

South Africa 1,164,399,211.35

Great Britain 717,845,843.56

Portugal 253,458,655.69

Japan 130,382,200.00Ireland 103,000,000.00

IDE - TOP 5 01/01/1997 - 30/06/2002

49%

30%

11%

6% 4%

África do Sul

Grã-Bretanha

Portugal

Japão

Irlanda


DYNAMIC OF FDIDYNAMIC OF FDI FDI - TOP 5

01/01/1997 - 30/06/2002

49%

30%

11%

6% 4%

South Africa

Great Britain

Portugal

Japan

Ireland


Inward FDI Performance IndexRank Economy Value

1988-1990Value 1998-2000

18 Singapore 13.8 2.2

19 Guyana 0.7 2.2

20 Vietnam 1.0 2.0

21 Kazakhstan 3.3 2.0

22 Finland 0.5 1.9

23 Mozambique 0.3 1.8

24 Bulgaria 0.8 1.8

24 United Kingdom 3.3 1.8


DYNAMIC OF FDIDYNAMIC OF FDI FDI by Provinces 1990 - 2002

Cabo Delgado

Niassa

Nampula

Zambézia

Tete

Manica

Sofala

Inhambane

Gaza

Maputo

Vale do Zambeze


DYNAMIC OF FDIDYNAMIC OF FDI FDI by Sector 1990 - 2002

0200,000,000400,000,000600,000,000800,000,000

1,000,000,0001,200,000,0001,400,000,0001,600,000,0001,800,000,000


• The Mozambican Government welcomes FDI in the following industries

– Manufacturing

– Mineral Exploration and Processing

– Tourism

– Fishing and Aqua-culture

– Construction

– Forestry

Investment PrioritiesInvestment Priorities


Investment opportunitiesInvestment opportunities

Agriculture, Agribusiness & LivestockIndustry, Forestry & MiningManufacturing & Power GenerationOil & Gas Tourism & HuntingTransport & CommunicationBanking & InsuranceIndustrial Free Zones


Investment GuaranteesInvestment Guarantees

The security and legal protection of property, rights and other assets;

Unrestricted import and repayment of loan and equity investment capital;

Repatriation of dividends, profits and capital; Liberalized banking and foreign exchange; Investment dispute resolution under ICC or ICSID

arbitration Investment risk insurance under MIGA and OPIC

facilities.


LILONGWE

Salima

Lichinga

Mandimba

Cuamba

Malema

Nampula

MOZAMBIQUE

NACALA

BLANTYRE

Tete

Nacala Development CorridorNacala Development Corridor

Lilongwe-Nacala Railway Upgrade (~US$250 mn)

Nacala Free Port

Moma Mineral Sands (~US$100 mn)

Tourism

Agrobusiness


PORT PROJECTSPORT PROJECTS

HOT IRON BRIQUETTED

PLANT

TOURISM PROJECTSTOURISM PROJECTS

FERTILISER & EXPLOSIVES PLANT

FERTILISER & EXPLOSIVES PLANTINDUSTRIAL PARKSINDUSTRIAL PARKS

SUGAR PROJECTSSUGAR PROJECTSFORESTRYPROJECTS

FORESTRYPROJECTS

CHROMITEBASED

PROJECTS

CHROMITEBASED

PROJECTS

ENERGYPROJECTSENERGY

PROJECTS

GAS BASED CHEMICALPOSSIBILITIES

(methanol

GAS BASED CHEMICALPOSSIBILITIES

(methanol

Synfuel Plantdiesel/petrol/waxes

Synfuel Plantdiesel/petrol/waxes

ASSORTEDMANUFACTURING

PROJECTS

ASSORTEDMANUFACTURING

PROJECTS

INFRASTRUCTURERoad, Rail, Electrity, Pipelines, Telecoms

INFRASTRUCTURERoad, Rail, Electrity, Pipelines, Telecoms

BEIRA Development Corridor

Centro de Promoção de InvestimentosMaravia

Zumba

Chifunde

Macanga

Angonia

Tsangano

Chiuta

Magoe

Cahora Bassa

Changara

Guro

Moatize

Tambara

Mutarara

Chemba

MocassaBarue

Marigue

Gorongosa

Caia

Morrumbala

Milange

Mocuba

Lugela

Maganjada Costa

Mopeia

Chinde

Nicoadala Namacurra

Quelimane

Inhassunge

Pebane

MarromeuCheringoma

Muanza

Dondo

Buzi

Nhamatanda

GondolaManica

Sussundenga

S O

F A

L A

M A L A W I

T E T EZ

I M

B A

B W

E M A

N I

C A

Z A M B E Z I A

BEIRA

DONDO

CHIMOIO

MANICA

HARARE

CATANDICA

GURO

LUENDA

CHINDE

MUANZA

INHAMINGA

CAIA

VILA DE SENA

CHEMBA

GORONGOSA

QUELIMANE

PEBANE

MAGANJADA COSTA

NANTENAMACURRA

LUGELA

NICOADALA

MILANGE

MORRUMBALA

MOATIZE

TETE

PANDAUNCUA

FURANCUNGO

TSANGANO

ULONGUE

FINGOE

CHIPERA

MPHENDA

SONGO

CHITIMA

MUTARE

Zambezi Valley SDI

Moatize(~US$ 500 mn)Moatize(~US$ 500 mn)

Coke by rail to Beira

Coal Terminal (Savane)Coal Terminal (Savane)

Thermal Station (~US$ 1bn)Thermal Station (~US$ 1bn)

Mpanda Uncua 1.2 GW

Cahora Bassa - 2 GW

Sena SugarForestry

Mutarara-1.2 GW

Peasant Agriculture

Sena Line rehabilitation:Beira-Moatize - 580 KmInhamitanga-Marromeu-88 KmD. Ana -Vila Nova Fteira-44 KmCost ~342 M US$


Natural Gas PipelineNatural Gas Pipeline

SishenSishen

BEIRABEIRA

MaputoMaputo(Mozal, MISP)(Mozal, MISP)

Field Dev.,Power Station,Transmission~US$ 2 bn

Pipeline~US$ 900 mn

Kudu

Mossgas

Pande/TemaneDev. & pipeline~US$ 1bn

Richards BayRichards BayDurbanDurban

Gas-based investment projectsCape TownCape Town

Power Station,~US$ 0.6-1.1 bn


KRUGERNATIONAL

PARK

LIMPOPOVALLEY

BANHINENATIONAL

PARK

ZINAVENATIONAL

PARK

GONAREZHOUNATIONAL

PARK

Limpopo SDILimpopo SDI

Chibuto Corridor Sands Chibuto Corridor Sands USD 1 blUSD 1 bl


KRUGERNATIONAL

PARK

LIMPOPOVALLEY

BANHINENATIONAL

PARK

ZINAVENATIONAL

PARK

GONAREZHOUNATIONAL

PARK

LIMPOPO PARKLIMPOPO PARK


Treaties and Bilateral Agreements• New York Convention on the Recognition and

Enforcement of Foreign Arbitral Awards• Cotonou Agreement

Investment Protection Conventions Alger, Denmark, Egypt, France, Germany, Nederlands, OPIC, Indonesia, Italy, Mauritius, People’s Republic of China,Cuba, Portugal, South Africa,Sweden, Switzerland, USA and Zimbabwe

Double Taxation Treaties

• Portugal, Mauritius , Italy and United Arab Emirates

Investment GuaranteesInvestment Guarantees


Investment IncentivesInvestment Incentives

General Benefits:

Exemption from import duties on goods in customs tariff class “K”;

Exemption on Stamp duty on company incorporation;

50% Reduction on the rate of real property transfer (SISA);

Investment tax credit varying from 5% to 15% of total investment ;

Deductible expenditure on advanced technology, professional training and construction of infrastructures of public utility;

Accelerated depreciation;



Special Fiscal Benefits (Rapid Development Zones):

Exemption from import duties on goods in customs tariff class “K” and “I”;


Exemption from real property transfer (SISA);

Investment tax credit varying from 20% of total investment ;


Accelerated depreciation (2 times the normal rate);



Special Fiscal Benefits (Agriculture):




80% reduction in corporate tax;


Accelerated depreciation (2 times of normal rate);



Special Fiscal Benefits (Hotel and Tourism):






Accelerated depreciation (3 times normal rate);



Special Fiscal Benefits (Large Scale projects-over US$ 500million):






Accelerated depreciation (2 times normal rate);



Special Fiscal Benefits (Industrial Free Zones):

Exemption from import duties, Value Added Tax, and Specific Consumption Tax on all construction material, machinery equipment and goods for the project;


Exemption on real property transfer (SISA);

60% reduction on income tax

To qualify the company should export a minimum of 85% and create jobs for Mozambican nationals


Investment Promotion CentreInvestment Promotion Centre The Investment Promotion Centre - CPI, has the

mandate to: promote and facilitate national and foreign investment

in Mozambique; operates as a “one stop-shop”; receive and registration of investment project

proposals; facilitate the concession of fiscal and customs

incentives; identify potential partners for joint-ventures; identify and disseminate investment opportunities ; provide institutional assistance to investors in the

implementation and exploration of investment projects.

www.mozbusiness.gov.mzwww.mozbusiness.gov.mz

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