Mozambique

Mozambique has as a land mass of 799,380km² and the third longest coastline on the Indian Ocean, covering a total distance of 2,700km. It has a population of 35.3 million and a GDP of US$21.9bn. GDP growth was 4.8% in 2023, and projected to reach 4.3% in 2024, driven by mineral extraction (coal, gold, iron ore, titanium, copper, and rubies). The metical (MT) is the national currency.

Mozambique\'s ruling party, Frelimo, recently won the country’s divisive, violence-marred election, extending its 49-year grip on power. Daniel Chapo, Frelimo’s relatively unknown presidential candidate who is seen as an agent of change, will replace Filipe Nyusi, who has served two terms. The election was marred by allegations of rigging and the killing of opposition supporters, prompting protests across the country.

Mozambique is expected to become a major liquefied natural gas (LNG) exporter due to the discovery of over 180 trillion cubic feet (tcf) of natural gas reserves. Growth is expected in key subsectors of oil and gas machinery and services, oil and gas parts and equipment and safety and security equipment. However, since 2017, attacks by armed jihadist militants have escalated in villages and towns in the gas-rich province of Cabo Delgado. It is reported that several thousands have died and over 1 million people have been displaced. The attacks resulted in the suspension of gas exploration and other activities by major players, and questions over investments in the huge gas discoveries. Despite efforts by Mozambican security forces supported by regional and international allies, containing the insurgency and protecting civilians remains a challenge. While attacks have recently decreased in some districts, widespread insecurity remains.

Mozambique has a mix of traditional and market economy systems. It has many natural resources, arable land, abundant water sources, energy, and mineral resources, as well as significant deposits of natural gas off its coast. Key economic activities are in agriculture, mining extraction and petroleum gas and services. Mineral deposits are in marble, bentonite, coal, gold, granite, gemstones, and limestone. Major contributors to the economy include agriculture, hunting, forestry and fishing, with prawns, cotton, cashew nuts, sugar, citrus, coconut, and timber being the most important crops.

Mozambique’s tourism attractions include its natural environment, wildlife, and cultural heritage, providing opportunities for beach, cultural and ecotourism. The services sector (that includes tourism) contributed 40.1% to GDP in 2023, with tourism contributing 8.9%, up from 7.4% in 2022. Agriculture contributed 26.7% and industry 21.9%.

Tourism is based on historical sites, national parks and nature reserves, beaches, and ecotourism. According to Deloitte, Mozambique’s tourism sector is one of the most realistic and viable options to diversify the economy and mitigate the potential challenges in resource expansion. The Mozambique government has identified tourism as an alternative to natural resources and agriculture to grow its economy and transform the tourism sector into an industry that can contribute to job creation and the well-being of local communities. The government offers a number of investment opportunities based on cultural heritage, rich nature, beautiful beaches, and largely untouched natural reserves.
The tobacco industry is dominated by British American Tobacco (manufacturing) and Mozambique Leaf Tobacco (MLT), which processes and supplies tobacco. The government considers the tobacco industry a major contributor to job creation and the provision of economic opportunities to the rural population. Nearly all tobacco is produced by smallholder farmers. Tobacco is mostly grown in a concessionary system, with MLT holding the majority of concessions. The country exported tobacco valued at US$154m in 2023, representing 17.0% of agriculture exports. Tobacco production has experienced a number of ups and downs in recent years.

In May 2013, 200 million barrels of commercially viable oil were confirmed at Rovuma Area 2, opening the prospects for oil production. Since 2010, substantial natural gas reserves have been discovered offshore in the Rovuma basin. In 2011, Italy\'s Eni discovered 425 billion cubic metres (bcm) (15tcf) of natural gas. Further discoveries include Mamba (75tcf in 2012), Coral Reservoir (15.65tcf in 2012) and Agulha (7tcf 2013). Area 1 and Area 4 blocks are considered to be two of the most important offshore gas developments on the African continent. Construction spearheaded by TotalEnergies in Area 1 will see the development of an LNG plant in Afungi, with production originally expected to begin in 2024. But intensifying attacks by Islamic insurgents near the gas site have posed serious challenges to the production timelines, and in April 2021, construction was suspended indefinitely. In Area 4, a joint venture by ExxonMobil (40%), Eni (40%) and China National Petroleum Corporation CNPC (20%) is constructing an LNG plant that will produce 152 million tonnes (Mt) of gas per year. The plant was scheduled to commence production in 2022, but rescheduled to start in 2025. Also in Area 4 is the Mamba Complex consisting of three fields (Mamba North, Mamba Northeast and Mamba South), which is being developed by Mozambique Rovuma Venture (with a 70% stake), Portugal\'s Galp Energia subsidiary Galp Mozambique (10%), South Korea\'s Korea Gas Corporation (10%) and state-owned ENH (10%). The development consists of 21 subsea wells which are expected to produce 100 million cubic feet (mcf) per day, with production expected in 2024.

Mozambique does not produce any crude oil or have any refining capacity, and it relies on imports to satisfy all its oil product demand. State-owned company Petromoc and its subsidiary Importadora Mosambicana de Petroleos (Imopetro) handle all fuel imports.

The clothing sector is one of several sectors that the government has identified for support, and clothing and textiles have been identified for procurement.


Sources: Who Owns Whom sector reports, CIA Factbook, African Development Bank, World Bank, Trading Economics, African Statistical Yearbook and IMF. ?>