Mozambique is virtually indistinguishable from the country of a few years previous, and anyone returning to the southeast African nation after such a time will recognise just how far the country has come in terms of socioeconomic development. After a stint of extraordinary growth, Mozambique’s newfound prosperity has given rise to economic and financial advantages for various sectors. Underpinned by the country’s vast resource base, political stability, and thriving business environment, Mozambique has emerged as an attractive environment for business and an economic climate filled with potential.
The southeast African nation is forecast to exhibit the second-highest growth rate in the continent from now until 2017, with an estimated average annual GDP growth rate of 6.88 percent, surpassed only by Malawi with seven percent. The country’s expansion from thereon is expected to exhibit even more impressive gains, with some analysts predicting that it will reach a peak of 15 percent by 2020.
Booming sectors
Among the best performing sectors to date are energy, mining, construction, agriculture and tourism, all of which have exhibited impressive gains and will likely continue to do so, provided the country remains on the same track.
In the field of infrastructure and civil construction, Mozambique currently ranks seventh in Africa in terms of number of projects, representing around $32bn. The sector also looks on course for continued expansion in the near future as foreign investors seek to exploit the country’s natural resources and improve upon its infrastructural capacity.
With regard to Mozambique’s agriculture, the Economist Intelligence Unit (EIU) estimates that over the course of the next few years investment in the sector will reach as much as $3.8bn dollars. Growth in the agriculture sector is especially positive for Mozambique, given that it accounts for the largest source of revenue for Mozambican families.
The tourism sector has also attracted several major foreign investors who’ve focused predominantly on constructing lodges and hotels to facilitate growth in the coming years. As a consequence, the market for travel agencies and tourism has matured, with each of the country’s various attractions seeing significant sales boosts as a result.
Among the best performing sectors to date are energy, mining, construction, agriculture and tourism
The country’s natural resources, in particular minerals, represent the largest natural capital in the country’s possession and perhaps the area of most significance in terms of revenue. Mozambique is among the 10 largest producers of coal in the world, and is believed to harbour as much as 23bn tonnes in reserves.
With regard to hydrocarbons, it is important to note that Mozambique boasts an impressive reserve base of approximately 200trn cubic feet, not to mention that petroleum will soon be made available in Mozambique, with the country’s first exploration due for commencement in 2014.
If the country manages to secure a steady stream of investment and improve upon its current infrastructural capacity in the coming few years, the near future could see hydrocarbons emerge as a major constituent of the Mozambique national economy. As an extension of this eventuation, if Mozambique’s recoverable assets are properly exploited, the country could quite possibly become one of the largest producers of natural gas worldwide.
Clearly there are a multiplicity of opportunities at hand in Mozambique, though for the country to go on to unprecedented economic successes and attract investment from further afield, companies must seek to take advantage of the sectors already exhibiting growth.
Growing the economy
Intelec Holdings, which was established in 1997, has accompanied and contributed to Mozambique’s economic development in the various sectors in which it operates, these being some of the biggest departments that have generated investment and boosted economic growth.
The holdings group was recently named the 11th-largest company in Mozambique, as part of the 15th edition 2013 of KPMG’s top 100 Companies, and also bears the ‘Made in Mozambique’ seal (acknowledging the company’s dedication to domestic products and industry) – something that represents the company’s commitment to furthering the country’s development.
The company is currently focusing on diversifying its investments to better leverage its existing channels, thus ensuring a better and safer return for investors. Intelec’s strategy in a very broad sense is to identify partners with knowledge of how best to serve the markets in which it operates.
Intelec Holdings’ mission is to act as a strategic partner for the various sectors in which it is active, and to further boost national development. The company’s vision is to contribute to the diversification and integrated growth of energy, mining and the other sectors in which it participates, in order to encourage national economic growth in Mozambique and improve upon the country’s business climate.
Intelec Holdings represents a number of key players in the energy sector, among them Electrotec, Electro Sul, Aberdare, and Gigawatt, who together play an integral part in powering Mozambique. Electro Sul in particular, which is certified by ISO 9001, KEMA, ISO 14001 and STS, has played a key role in advancing the country’s electrical and electronic engineering proficiency, as well as in the management of energy networks. The Intelec subsidiary was selected for the World Quality Commitment Award – Paris 2010 in recognition of its commitment to quality, leadership, technology and innovation in the field. Electro Sul is also a major partner of Electricity of Mozambique (EDM) and constitutes a considerable part of the country’s electricity demands as a whole.
In the textiles field, Intelec Holding is preparing to revitalise the sector following a factory reactivation in conjunction with three major Portuguese partners. The project is entitled MCM (Mozambique Cotton Manufacturers) and the amount of money involved equates to an investment sum in the region of $40m.
Foreign investment
External business partners have given monetary authorities reason enough to support foreign investment, whereas the state, through the implementation of its fiscal policy, regulates and streamlines the most important socioeconomic areas and creates a suitable business environment for private enterprise. Extensive legal reforms in aspects of law as far ranging as financial, tax, labour, trade legislation and ownership have also strengthened Mozambique’s business environment and encouraged private investment by quite a margin.
The economic potential of the country with respect to investment in agro-industry is formidable, and is best characterised by the industry’s generous tax incentives. With the aid of various economic agents, together with the family sector, developments such as AgroMoz in the provinces of Nampula and Zambézia, which together equate to approximately 60,000 hectares, have been made possible.
Intelec’s achievements in innovation and national development are also quite evident in technology and human resources, which are both emerging as significant contributors to the Mozambique economy. What is certain is that the country is growing, and Intelec is living up to its ambitions to form a vital part of Mozambique’s growth process.
The success of the company also lies with its visionary Chairman Dr Salimo Abdula, who has seen opportunities where others have seen threats and positioned Intelec in an ideal spot to make real progress. In addition to being the Chairman of Intelec Holdings, Abdula is also Chairman of Vodacom Mozambique, a company of which Intelec Holdings is also a shareholder. Further still, Abdula is President of the Business Confederation of Portuguese Language Countries (CE- CPLP) and the Chairman of the General Assembly at the Confederation of Business Associations of Mozambique (CTA).
Abdula is believed by many to rank among the 100 most influential figures in Africa, and has played a crucial part in Mozambique’s socioeconomic development. Intelec Holdings, under the guidance of Abdula and the rest of his team, looks forward now to continued growth, wider development and improvement in all the sectors in which it operates, while simultaneously seeking to create value for its shareholders, partners, and the communities in which it works.
