Mozambique: Government committed to improved business environment

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Mozambique: Government committed to improved business environment

7:58 CAT | 01 Apr 2022

Photo: CTA

The Mozambican government on Thursday reiterated its commitment to promote continually a macro-economic and regulatory environment favourable to the growth and improved competitiveness of Mozambican businesses.

Prime Minister Adriano Maleiane made the promise in Maputo at the closing session of the Annual Private Sector Conference, an event that ran for two days on the theme “Reforming the Business Environment for Economic Recovery”.

“To achieve this goal, we shall continue to strive for fiscal consolidation, implementing measures to mobilise more revenue and to hold back public expenditure, in order to guarantee the maintenance of macro-economic stability”, declared Maleiane.

He also promised that the government will prioritise policies and measures to encourage investment in priority productive sectors, namely agriculture, fisheries, industry, energy, tourism and infrastructures. These were the sectors with the greatest potential for diversifying the national economy, and generating opportunities for employment and income.

To complement the government’s actions, Maleiane added, the private sector is called upon to play a preponderant and interventive role by identifying actions for its direct intervention.

“To this end, we urge the private sector to improve its participation in the sector joint working groups, to ensure greater alignment between the parties – that is, between the government and private business”, he said.

He claimed that the “rich contributions and debates” at the conference bore witness once again to the determination and interest of the government and the private sector to seek solutions that guarantee continual improvement in the business environment and the attraction of more investments.

Maleiane noted that concrete proposals had been made at the conference to make private businesses more robust, to speed up industrialization, by capitalizing the use of existing natural resources, particularly natural gas, and to create new financial products for the recovery and resilience of the business sector.

Such proposals will be included in a Business Sector Economic Recovery Plan, to be approved in the first half of this year, in line with a memorandum signed between the government and the private sector during the conference.

“We want to ensure the implementation of structural reforms, and an improvement in the legal framework, in order to boost the business environment and attract more national and foreign investment”, stressed Maleiane.

The Confederation of Mozambican Business Associations (CTA) had hoped that the government would reduce taxes on businesses. Like employers all over the world, the CTA thinks it members are overtaxed. In particular, the CTA wanted to slash the tax on profits from the standard 32 per cent to 10 per cent.

But speaking on Wednesday, on the first day of the conference, President Filipe Nyusi, brushed such demands aside. He told Mozambican businesses they should not depend on fiscal incentives in order to compete.

Nyusi said the government wants a strong private sector – but that did not mean accepting everything proposed by the CTA. “A business class that depends on protectionist legislation is not sustainable”, he warned.

Instead, Mozambican businesses should organise themselves so as to compete on a footing of equality with businesses from elsewhere in the southern African region.

Source: AIM