Portuguese businessmen assume that Mozambique has a fertile market with business opportunities, but they point to “very high” interest rates, which make access to financing difficult, and bureaucracy as the main limitations.
“There are very high interest rates and excessive bureaucracy for those who want to start an activity,” the vice president of the Mozambique-Portugal Chamber of Commerce, Paulo Oliveira, told Lusa on the sidelines of the XIX Annual Conference of the Private Sector. Sector (CASP), which took place this week in Maputo.
Even among the limitations to investing in the country, the corruption and slowness in judicial procedures, thus defending a dynamic and rapid justice process that provides guarantees to businessmen, not only the Portuguese.
Still, despite the difficulties noted, Paulo Oliveira affirms that the country is fertile for investments and needs for various types of services, in which Portugal can be the gateway for Mozambique to explore the European market.
“We have to look at Portugal as an entry into the European market (…). But when Portuguese companies look at us, they not only see 30 million potential buyers, but they have to look at the block where we are located, which is in SADC. [comunidade dos países da África austral]with very great potential,” says the vice president of the Mozambique-Portugal Chamber of Commerce.
Although there is already an important commercial market between both countries, Oliveira assumes that business volume has been falling since 2021, due to cyclones, the armed insurgency in Cabo Delgado and the Covid-19 pandemic.
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“This has an effect on the economy and purchasing power has fallen. It should be noted that foreign direct investment in the country has fallen and the imports that we have been making from Portugal have been reduced,” he points out.
The Confederation of Economic Associations of Mozambique (CTA) recognized last April that Exports from Mozambique to Portugal falltaking into account that ten years ago they were worth just over 100 million dollars (92 million euros) to Portugal, five times more than what they currently export, while imports fell by half in the same period.
Luís Miguel, president of the board of directors (PCA) of hidral Moçambique, a logistics company with Portuguese capital that has been operating in the country for 11 years, recognizes Lusa’s expectation of increasing the value of imports from Portugal.
“Unlike what happens in other geographies, the problem is not related to the lack of opportunities in Mozambique, but that there are actually plenty of them,” he says, pointing out the need for more companies to help in the value chain: “So that we can, we don’t have to do everything.”
“Mozambique is fertile in opportunities. You Investors must come with maturity and a long-term investment plan.. Things don’t work if they come without the desire to learn,” he adds.
In the logistics sector, in which it operates, with 90 workers and warehouses in all provinces, it has faced challenges due to insufficient railway infrastructure and the degradation of main roads, which makes the movement of goods difficult.
“Doing logistics is a great challenge, the country is huge. If we think about moving the territory of Mozambique, with 2,500 square kilometers, to Europe, we would be talking about a distance between Lisbon and Warsaw. […]. We need the roads to work,” he acknowledges.
“We are hearing about financing lines (…). We don’t go to the bank and at this point we think it’s difficult. If we could have access to more resources at subsidized rates, we would take advantage of it to accelerate our growth,” he states.
For the president of the board of directors of the Portuguese company Sumol+Compal, Fernando Oliveira, with 150 workers in Mozambique and a capital of 11 million euros, the Financing “is one of the biggest difficulties”.
“Because the interest rates are quite high. Therefore, investors need to bring their capital to invest in Mozambique,” he states.
Operating in Mozambique for 11 years, he says there are business opportunities, but warns: “The market is attractive, but don’t come looking for quick results.”
Source: Observadora
