SA, Moza trade firms

The country is exporting 50 percent of its products to South Africa, making its neighbour its biggest trading partner. Economic adviser to Mozambique’s ministry of industry and commerce, Sergio Carlos Macamo, told delegates at the PriceWaterhouseCoopers South Africa/Mozambique investment seminar in Nelspruit that Mozambique was also importing 50 percent of its products from its neighbour. The partnership between the two countries stems from the R25 billion Maputo Development Corridor that was initiated in 1996 and has already resulted in the massive upgrading of transport infrastructure between the two countries. The N4 toll road links Gauteng to Maputo harbour, which is closer to Gauteng than the Durban port. Macamo said Mozambique was offering attractive investment packages and had preferential access to European and United States markets. “We have also made it easy for private businesses to invest in our country through simplifying industrial and commercial licensing,” he told the seminar. Mozambican companies, he said, were looking for partners in glass, textile and rubber ventures. Macamo said there were also vast opportunities for South African investors in mega projects such as coal mining, bio-diesel manufacturing, aluminium and the refurbishment of railway lines. David Robbetze, the chief executive officer of the South Africa/Mozambique chamber of commerce, said the risk of investing in Mozambique was small. Robbetze said Mozambique was politically stable, had a positive relationship with South Africa. He acknowledged that land ownership and transport were limited, and skilled labour was short. According to the head of the linkages division of Mozambique’s Investment Promotion Centre, Antonio Macamo, the country’s economy had been growing at 8,2 percent since 1998. “Our infrastructure is under massive improvement, and there is ample availability of natural resources such as coal, land and natural gas,” Macamo said. Meanwhile, repairs to the railway between Malawi and the northern Mozambican port of Nacala, damaged in a storm last week, will take at least a month to complete, according to a report in an issue of the Maputo daily Noticias. Torrential did not only sweep away ballast from under the tracks ‘ they also opened an enormous crater at kilometre 421, between the stations of Malema and Nataleia, west of Nampula city. For 15 metres the line now dangles in mid-air, with a drop of six metres to the bottom of the crater. Sources in the Northern Development Corridor (CDN), the consortium that manages the Nacala line, said repairing such major damage woud take at least 30 days ‘ possibly longer if rains continued. There was a second cut in the line at kilometre 443, but here the damage was fairly minor, and CDN technical teams were able to repair it at the weekend. CDN also hopes to erect an “alternative structure” to allow goods trains to and from Malawi to use the line, despite the crater. This would involve installing a number of concrete pillars under the tracks on the damaged portion of the line, which could support the weight of a goods train. In another development, the final obstacles to the transfer of the Cahora Bassa dam on the Zambezi river to Mozambican ownership have now been overcome, according to Mozambique’s Energy Minister, Salvador Namburete. The minister has announced that the technical negotiations between Mozambican and Portuguese teams in Maputo have reached a successful conclusion, thus making it possible for the final agreement on the dam to be signed. The date for the agreement will depend on the availability of Mozambican President Armando Guebuza and Portuguese Prime Minister Jose Socrates. Namburete spoke to the Press jointly with the head of the Portuguese delegation, the Secretary of State for Finance, Carlos Costa Pina, announcing the end of the negotiations. “The two countries will later agree the date for the formal signature in Mozambique of the documents resulting from the negotiations”, said Namburete. Costa Pina struck a more cautious note, stressing the need “to act prudently and without haste”. The Mozambican authorities had hoped that the final deal would be signed in December, and the nature of the “technical details” that delayed matters was still far from clear. Mozambique and Portugal had signed a memorandum of understanding on Cahora Bassa in November last year, during Guebuza’s first official visit to Portugal. Under that memorandum, control of the company that operates the dam, Hidroelectrica de Cahora Bassa (HCB), would pass from Portuguese into Mozambican hands. Currently the Portuguese state holds 82 percent of the shares in HCB, and the Mozambican state has a minority holding of 18 percent. The November agreement sought to reverse this: Mozambique would end up with an 85 percent stake, and the Portuguese holding would be reduced to 15 percent. This would depend on paying Portugal U$950 million – $US250 million from HCB’s own funds, while the Mozambican government would have to find the other US$700 million. If the letter of the memorandum had been followed strictly, then the final agreement should have been signed by 17 December last year and the first payment for the dam should have been made in January this year. Last week’s “technical negotiations” followed a second visit by Guebuza to Lisbon ‘ for the inauguration of the new Portuguese President, Anibal Cavaco Silva. While in Lisbon, Guebuza took the opportunity, on 9 March, for discussions with Socrates, which seems to have broken the logjam.

March 2006
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