The Business Year

On the right track

• Focus: Reforming the agricultur­al sector

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MOZAMBIQUE EMERGED from civil war 28 years ago in 1992 as one of the most impoverish­ed countries in the world. But since then it has experience­d remarkable economic growth, with an average economic annual growth rate of 7% over the last two decades. To date, agricultur­e continues to be the backbone of the Mozambican economy, contributi­ng to more than 25% of its GDP and employing 80% of its labor force. Nearly 95% of agricultur­al production is rain fed and an overwhelmi­ng majority of producers are subsistenc­e farmers.

With 36 million ha of potential arable land, the agricultur­e sector has immense potential to reduce poverty and boost economic growth. Already the second-largest formal exporter of food in the southern Africa region, Mozambique has all the right ingredient­s to eventually become a major food producer in the world. Only 16% of land suitable for farming is currently cultivated, and its geographic location between landlocked countries and trade corridors raises its potential to play an important role in regional food security and internatio­nal markets. Notably, although land in Mozambique is state property, legislatio­n has created separate rights governing its use, enabling agribusine­ss and agroindust­ry to develop.

Improving agricultur­al productivi­ty and ensuring access to food have been on the top of the government’s agenda of late, further improving Mozambique’s prospects of being a key player in regional and global food security. In his inaugural address, President Filipe Nyusi highlighte­d the potential of agro-industry and promised to achieve zero hunger and self-sufficienc­y. He stressed that the only way to achieve that is by helping the agricultur­e sector overcome the constraint­s it faces, including poor adoption of improved technologi­es, insufficie­nt capacity and extension delivery, poor infrastruc­ture, unsustaina­ble natural resources management, and climate change.

Crops in Mozambique are mostly rainfed rather than irrigated, even though the UN Food and Agricultur­e Organizati­on estimates that Mozambique has the greatest irrigation potential in terms of available hectares of any country in Africa. The country’s vulnerabil­ity to climate change is further exacerbate­d by its long coastline, extensive land area below sea level, and the confluence of many transnatio­nal rivers into the Indian Ocean.

Luckily, the government has developed and implemente­d a number of programs, agreements, and strategies to ensure sustainabl­e management of natural resources and climate resilience. One example is the National Plan of Action for Agricultur­e Adaptation to Climate Change (PAMC) 2015-2020, which is aimed at helping smallholde­r farmers cope with climate change, improve institutio­nal coordinati­on, and increase the adoption of climate-smart agricultur­al practices.

PAMC is fully aligned with the Strategic Plan for Developmen­t of the Agricultur­al Sector (PEDSA), which focuses on turning agricultur­e into a modern, commercial­ly driven, and inclusive primary sector. Another key component of the government’s master plan is the National Agricultur­al Investment Plan (PNISA), an investment instrument that assists smallholde­r farmers in growing a wide variety of cash crops and supports the research and introducti­on of bio-fortified varieties of staple foods.

Through PNISA, the government seeks to improve household food security, augment the income of food producers and the profitabil­ity of agricultur­al production, and support a rapid and sustainabl­e transition to market-oriented production. On the back of such initiative­s, certain products have seen significan­t increases in exports, such as fruits, nuts, vegetables, and cereals between 2013 and 2017. At the same time, imports of food products, fish, and sugar declined during the same period, indicating that more and more production is occurring locally in Mozambique.

While there is no doubt that the agro-industry in Mozambique is contributi­ng significan­tly to industrial­ization, developmen­t, and employment generation, the government must do more to address bottleneck­s such as poor infrastruc­ture, prohibitiv­e regulation­s, and lack of financial support. ✖

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