Mozambique

Capital city: Maputo

Population: 32,163,047 (2021)

Land area: 801,590 km²

Official language: Portuguese

Legal system: Civil law

Time zone: GMT+2

Currency: Mozambican metical

GDP: 13.96 USD Billion (2021 est.)

Main industries: Aluminum, coal, petroleum products, chemicals (fertilizer, soap, paints), cement, asbestos, glass, textiles, tobacco, food processing, beverages

Principal exports: Prawns, cotton, cashew nuts, sugar, citrus, copra and coconuts, and timber.

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The entire length of the southeast African country of Mozambique’s eastern border comprises a long coastline overlooking the Indian Ocean. The nation borders fellow Commonwealth nations Zambia and South Africa towards the northwest and southwest, respectively and Tanzania to the north with non- Commonwealth nation Zimbabwe sharing its middle-western border. The capital, Maputo, is a port city located in the southernmost part of the country where the nation shares a short length of its border with fellow Commonwealth nation, Eswatini.

Mozambique harbours a varied landscape, giving rise to savannahs and dense subtropical forests. It has many rivers, of which the Zambezi is the largest, which flow towards the Indian Ocean on the country’s eastern border. The Mozambique Channel separates Madagascar from the African continent, which has lent itself to many harbours along Mozambique’s coastline. Vibrant pristine beaches including the famous Tofo beach are dotted along the eastern coastline with an attractive view of offshore marine parks as well as the Bazaruto archipelago and the Quirimbas archipelago.

Demographic

The population was recorded to be 32,077,072 by July 2021 estimates. Mozambique’s population growth, although lower than other African countries, is high on the global scale. The country’s population is very young, with nearly two-thirds of its population aged under 25 years and less than 10% of Mozambique’s population is 45 years or above. 99% of the population is of African descent whilst the rest include Europeans, Indians, Pakistani, and Chinese.

There are over 40 languages spoken in Mozambique. The country’s official language is Portuguese, but it is only spoken by around half of the population. The most spoken primary languages in Mozambique, include: Makhuwa, Changana, Nyanja, Ndau, Sena, Chwabo, and Tswa. 27.2% of the population is Roman Catholic, 19% are Muslim, 16% are Zionist Christians, and 15.3% are Protestant whilst the remaining are not specified.

History

The first humans to inhabit what is now Mozambique were hunter-gatherers, who left behind rock art and other evidence of their existence. The Bantu migration brought new people to the region around 1000 CE, and they formed a number of kingdoms and city-states, including the Kingdom of Gaza, the Kingdom of Mapungubwe, and the Kingdom of Zimbabwe. These societies were characterized by their agricultural practices, which included growing crops such as millet, sorghum, and maize. They also traded extensively with other parts of Africa and with the Arab world, and they established important trade routes that linked the interior of the continent to the coast.

One of the most important kingdoms in pre-colonial Mozambique was the Kingdom of Zimbabwe, which was established in the 11th century and flourished until the 15th century. The kingdom was located in what is now Zimbabwe, Mozambique, and Zambia, and it controlled a vast territory that was rich in gold, ivory, and other valuable resources. The kingdom was characterized by its impressive stone architecture, including the ruins of Great Zimbabwe, which are still visible today.

Another important pre-colonial kingdom was the Kingdom of Gaza, which was founded in the 17th century by a group of Nguni-speaking people who had migrated from what is now South Africa. The kingdom was located in what is now southern Mozambique and parts of Zimbabwe, Swaziland, and South Africa, and it controlled a large and prosperous territory. The Kingdom of Gaza was known for its sophisticated political system, which was based on a strong central authority and a complex hierarchy of chiefs and sub-chiefs. In addition to these kingdoms, there were also a number of smaller societies and city-states in pre-colonial Mozambique, including the Kingdom of Mapungubwe, which was located in what is now northern South Africa, and the Kingdom of Sofala, which was located on the central coast of Mozambique. These societies were often involved in trade with other parts of Africa and with the Arab world, and they developed sophisticated systems of governance and social organization.

The Portuguese first arrived in Mozambique in the late 15th century, during the era of European exploration and colonization of Africa. It was the arrival of Portugese explorer, Vasco da Gama, at the Cape of Good Hope in 1498 which began the Portugese colonial saga of Mozambique. Initially during the early 16^th century, they established a few trading posts along the coast and Sena and Tete on the Zambezi River, where they traded goods such as gold, ivory, and slaves with the local populations. The Portuguese attempted to gain control of Mozambique and Sofala by establishing garrisons and trading posts in the interior. To legitimize their positions, they created land grants called prazos that were initially held by Europeans but eventually became centers for African Portuguese and African Indian communities defended by slave armies. However, by the mid-19th century, most prazos had declined and several had resisted Portuguese domination until the late 1800s. While the Portuguese initially gained control of coastal trade from Arabs, the Mazrui and Omani Arabs eventually regained much of it, causing the Portuguese to retreat south. In the 19th century, other European powers, especially the British and French, became increasingly involved in the region’s trade and politics.

From the early 1800s to the 1830s, various military and raiding groups from the northern Nguni heartland invaded southern and west-central Mozambique, causing disruptions in trade and production. These groups, which emerged from the Zulu state, seized cattle, hostages, and food as they moved through Mozambican territory. Two main groups, the Jere under Zwangendaba and the Ndwandwe (later known as Ngoni) under Soshangane, invaded Mozambique and caused widespread disruptions. While Zwangendaba’s group settled to the west of contemporary Mozambique, Soshangane’s group crossed the Limpopo into southern Mozambique and eventually formed the Gaza state. However, a succession struggle between the sons of Soshangane in the 1860s caused significant suffering in the region and weakened the Gaza state.

By the 1880s, the Portuguese controlled trade and collected tribute in coastal areas from Ibo to Lourenço Marques. However, they had limited control over events outside these areas, which were frequently raided by neighbouring states for refusing to pay tribute. These states began to ally with the Portuguese, who encouraged and exploited these alliances. In the 1890s, a coalition of Portuguese troops and African armies marched against the Gaza state, and after their leadership was defeated in 1897, southern Mozambique came under Portuguese control. Over the next two decades, the Portuguese gained control over various regions in Mozambique through military campaigns. Trade in ivory, gold, slaves, rubber, oilseeds, and European goods continued throughout the 19th century. However, European economic interest and influence in the region changed rapidly due to developments in Africa and Europe. The need for African labor on sugar plantations and in South African ports and mines after the discovery of diamonds and gold fueled the scramble for greater control over land and its inhabitants. This struggle for access to mineral-bearing lands and labor force led to increased European control over Southern Africa.

Portugal claimed a large area of land in present-day Mozambique and Angola, but its claims were contested by the British. Despite negotiations, Portugal was forced to accept Britain’s definition of Mozambique’s western and southern boundaries due to its debt to British financiers. Portugal relied on its strategy of leasing large tracts of land to private companies for development, leading to the establishment of the Mozambique Company, Niassa Company, and Zambezia Company in the 1890s. These companies exploited the lands and peoples of specific areas in exchange for developing agriculture, communications, social services, and trade. Economic development and infrastructure investment were tied to company interests and undertaken at the expense of the African workforce. The Portuguese government eventually terminated the charters of the major concession companies, bringing Mozambique under direct Portuguese rule.

After a 1926 coup, Portugal established the “New State” in Mozambique, which continued to exploit African people and resources. However, in the 1950s, Portugal initiated development plans to upgrade Mozambique’s infrastructure and expand its economy, while still maintaining strict control over the mobility of Africans. This policy caused discontent among the African population, leading to the emergence of a broad African leadership in the late 1950s, which formed the Mozambique Liberation Front (Frelimo) in 1962. Frelimo engaged in armed struggle, launching guerrilla attacks in northern Mozambique in 1964. Portugal responded with a large military effort, but was ultimately unable to defeat Frelimo. In 1974, a coup in Portugal led to a cease-fire, allowing Frelimo to assume power in an independent Mozambique on June 25, 1975, with Samora Machel as president. Most Mozambicans widely supported Frelimo’s decisions to close the border with Rhodesia (known now as Zimbabwe). Mozambique’s post-independence period was marked by a devastating civil war that lasted from 1977 to 1992. The war was fought between FRELIMO and the Mozambican National Resistance (RENAMO), a group that was supported by South Africa and opposed to FRELIMO’s Marxist-Leninist ideology. These decisions came at a heavy price when Mozambique suffered major losses of revenue and lives and the destruction of key infrastructure. FRELIMO had mixed success with its social and economic policies during its first decade because even though forced cultivation, forced labour, and ethnic discrimination ended, the party’s commitment to communal and state-run agriculture antagonized many farmers, who had hoped to see land returned to their families.

By 1985, FRELIMO recognized the failure of its agricultural policy of moving farmers into communal villages plus coming under pressure from international creditors, it began de-emphasizing state ownership and control of markets in favour of the family agricultural sector. Mozambique joined the World Bank and the International Monetary Fund (IMF) in 1984 and adopted their demands to privatise the economy under a structural-adjustment program. Several years later Joaquim Chissano, who had become Mozambique’s president when Machel died in a plane crash in 1986, introduced a new constitution that ended FRELIMO’s one-party rule and Mozambique’s identity as a socialist country. The Rome General Peace Accords were signed in 1992, which established a multi-party system and paved the way for reconstruction and development. Since then, Mozambique has made significant progress in rebuilding its infrastructure, expanding its economy, and improving its political system.

Key dates

200-300 Bantu-speaking tribes migrate from west-central Africa

1498 Portuguese explorer Vasco da Gama makes landfall at Mozambican coast

1962 Exiled activists form Mozambique Liberation Front – Frelimo – headed by Eduardo Mondlane

1500-1600 Portugese settle into interior; set up trading posts and give out land to European settlers

1842 Slave trade outlawed by Portuguese forces but the trade continues illegally for decades

1932 Trading companies disbanded on orders from Portuguese leadership; direct rule over colony begins

1964 Frelimo forces begin war of independence. Guerrilla tactics frustrate Portuguese and Frelimo take control of much of north.

1974 Military coup in Portugal causes new government to agree on independence with Frelimo. More than 250,000 Portuguese inhabitants leave.

1975 Mozambique becomes independent under Frelimo one-party rule of President Samora Machel.

1976 Renamo anti-Frelimo group aided by Rhodesia and later South Africa.

1990 Government amends the constitution to allow a multi-party-political system.

1992 President Chissano and Renamo leader Afonso Dhaklama sign peace deal in Rome.

1995 Mozambique joins the Commonwealth of Nations

2006 In July, the World Bank cancels most of Mozambique’s debt under a plan promoted by the G8 nations

2014 The ruling Frelimo party and its candidate Filipe Nyusi win presidential and legislative elections after Renamo signs truce in October

2020 President Nyusi inaugurated after winning re-election for final five-year term.

Legal System and Government

Mozambique is a republic and a multiparty democracy. It has an executive president as head of state and government, who is directly elected for a five-year term and serves a maximum of two terms who oversees appointing Council of Ministers.

The Mozambican judicial system rests upon Portuguese civil and customary law. Subordinate courts in Mozambique may appeal to the Supreme Court, which can hear both civil and criminal cases. The judges who preside over these courts are chosen by the President on either the Superior Council of the Judiciary’s advice or that of the Superior Council of the Administrative Judiciary. There are also special courts, which deal with specialised issues.

Economy

Mozambique has a low-income status but is the 10^th largest economy in Sub-Saharan Africa with the agriculture sector and the construction and financial services industries as the cornerstones of the economy. Mozambique has suffered negative GDP growth due to the COVID-19 pandemic but a robust average growth rate of 4.9% in the past decade and recovery of the services sector and hike in liquid natural gas (LNG) production and commodity prices have set it back on a path of recovery with an estimated GDP growth rate of 4.1% expected in 2022.

Agriculture is the primary source of income for approximately 70% of the nation’s labour force and contributes 28% of GDP. The sector has been the pillar of the economy since independence which include mainly cashew nuts, rice, maize, sorghum, and cassava as well as poultry and livestock; the nation is also famous for its fresh seafood. Cashews nuts and tobacco are amongst the most well-known export products to come out of Mozambique due to the ideal climate and the well-established processing industry for these products. Despite farming being the source of livelihood for most of the nation, productivity is low and farmers and fishermen often do not have surplus for sale due to which technological advancement, high-yield seed varieties and automated cultivation techniques are required to move out of the traditional subsistence farming methods.

The sector of industry employs 9% of the labour force and contributes 21.9% of GDP of which 8% comes from manufacturing, in particular the manufacturing of tobacco, beverages, food, petroleum products, cement, aluminium and textiles. The services sector employs 21% of the labour force and comprises 40.1% in terms of GDP contribution. Despite being the largest sector in terms of output share, it has remained has not expanded beyond retail and commercial services such as travel, logistics and transport.

Trade

Mozambique’s GDP stood at US$15.78 in 2021 billion. Exports for the year amounted to US$5.11 billion and mainly comprised of mineral fuels, mineral oils and products of their distillation (43.1%), aluminium and articles thereof (22.1%), ores, slag and ash (8.5%) and edible vegetables, roots and tubers (3.0%). These commodities were exported to South Africa (16.7%), India (15.7%), the Netherlands (11.0%) and China (9.6%). In terms of imports, for the same year, Mozambique’s main import items included mineral fuels and oils and products of their distillation (16.9%), machinery, mechanical appliances, nuclear reactors , boilers and parts thereof (9.5%), cereals (7.8%) and vehicles other than tramway/railway rolling stock (7.1%).

Mozambique has signed the African Continental Free Trade Agreement, alongside the EU-SADC Economic Partnership Agreement and is a participant of the Global System of Trade Preferences among Developing Countries (GSTP).

Investment Opportunities

Mozambique’s trade openness in 2020 was recorded at 103.28%, above the world average of 83.47 according to the World Bank. With an abundance in labour, natural resources and 36 million hectares of arable land, Mozambique is well endowed and well positioned for foreign investment, both direct and indirect. Mozambique offers several investment opportunities across various sectors. In agriculture, investments in equipment such as tractors, farm trucks, and harvesting equipment can significantly boost productivity. The construction sector also presents opportunities in road and railway development and general infrastructure. Energy investment areas include coal, gas, hydropower, solar, wind, and transmission lines. Fast Moving Consumer Goods (FMCG) and franchising are also promising areas for investment. Mozambique’s fishing industry, with prawns, tuna, and lobster as the main catches, is another attractive investment sector. The Information and Communications Technologies (ICT) sector offers investment opportunities in wireless technologies, cyber security, automation, data centers, and digitization. The country also has promising mining opportunities for coal, metals, gemstones, rare earths, precious metals, and critical minerals. The oil and gas sector offers opportunities in exploration, production, distribution, and general supply chain. Safety and security investments in safety equipment, as well as investments in tourism, healthcare, and transportation, such as ports, airports, logistics, and freight, are also investment areas worth considering in Mozambique.

Mozambique’s access to the Mozambique Channel is a unique asset, which distinguishes the country from its neighbours. Foreign investments could help Mozambique to capitalise on its potential as a hub for Eastern and Southern African trade. Similarly, commercial fishing ventures could be profitable with the proper development of Mozambique’s coastline, with a particular focus on sustainable fishing and encouragement of protected zones to prevent any adverse impact on the nation’s rich biodiversity.

As Mozambique’s economy continues to rebound, the role of the services sector has been highlighted as integral for shifting Mozambique away from reliance on low-productivity agriculture and to increase the availability of jobs that will upskill the labour force. The government has responded by launching the Economic Acceleration Measures Package in August 2022 to accelerate private sector development and diversify economic output by introducing new tax incentives, debureaucratisation and the creation of the Mozambique Sovereign Fund to ensure oil revenues are used in a transparent and equitable manner to insulate against external economic shocks.

Although the agriculture sector in Mozambique has the potential to significantly contribute to reducing poverty and alleviating food insecurity, its growth has been hindered by several factors. The absence of a development agenda with a focus on equity in agricultural growth and economic progress, coupled with the impact of climate hazards, has resulted in annual losses of up to US$ 790 million. Investments that have taken an integrated approach to address climate challenges in the agriculture, forestry, and energy sectors have shown to be successful in creating synergies and providing additional benefits to smallholders. Such investments have proven to be more effective than plot interventions and are being encouraged by the government. As such, the upscaling and improvement of sustainable practices in the agricultural sector is a very lucrative field for foreign investors.

Sources

https://data.worldbank.org/indicator/SP.POP.TOTL?locations=MZ

https://thecommonwealth.org/our-member-countries/mozambique

https://www.britannica.com/place/Mozambique/History

https://www.bbc.com/news/world-africa-13890720

https://www.doingbusiness.org/en/data/exploreeconomies/mozambique

https://import-export.societegenerale.fr/en/country/mozambique/trade-country-risk

https://import-export.societegenerale.fr/en/country/mozambique/investment-country-risk

https://wits.worldbank.org/CountryProfile/en/MOZ

https://www.nationsencyclopedia.com/Africa/Mozambique-JUDICIAL-SYSTEM.html

https://www.privacyshield.gov/article?id=Mozambique-Import-Tariffs

https://translatorswithoutborders.org/language-data-for-mozambique#:~:text=Portuguese%20is%20the%20country’s%20official,Sena%2C%20Chwabo%2C%20and%20Tswa.