Mozambique: President mulls ways of helping SMEs recover from protest damage

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Mozambique: President mulls ways of helping SMEs recover from protest damage

9:26 CAT | 21 Feb 2025

FILE - For illustration purposes only. [File photo: Mintformations]

The president of Mozambique, Daniel Chapo, on Thursday said that he is considering measures such as the restructuring of the debt of small and medium-sized enterprises and subsidised credit lines in order to support the recovery of companies that have been affected by demonstrations in the wake of October’s general elections.

“In search of solutions to alleviate the financial pressure on companies, today [Thursday] we met with the Association of Commercial Banks to evaluate economic recovery measures aimed at mitigating the impacts of the recent violent demonstrations,” announced the head of state, in a message on his official account on the social network X.

Chapo added that the meeting “highlighted” the possibility of “restructuring the debt” of small and medium-sized enterprises “directly or indirectly affected by the situation.”

On the other hand, he mentioned the “creation of subsidised credit lines for companies that don’t have debts but need capital to boost their businesses, with annual interest estimated at 15%.

“With these and other measures under consideration, we hope to strengthen the resilience of SMEs and ensure the rapid sustainable recovery of the national economy,” he added.

On 30 December, the Confederation of Economic Associations of Mozambique (CTA) told Lusa that more than 500 businesses had been vandalised during post-election demonstrations in Mozambique and at least 12,000 people are now out of work.

On Thursday, the vice-president of the CTA’s industry department, Onório Manuel, told Lusa that these “are companies that have been vandalised and are located, above all, in Maputo province, where most of the country’s industrial fabric is.”

According to the representative, more than 12,000 people found themselves out of work because of the closure of these companies and, if the situation prevails, more people could lose their jobs.

“We’re talking about the biggest food industries in the country… which already have damaged equipment and their infrastructure has been completely destroyed,” Manel said. “We’re going to have a shortage of products and probably see a galloping rise in prices.”

He added that the number of entrepreneurs considering closing their doors due to insecurity is on the rise.

Since the general elections on 9 October, Mozambique has been wracked by widespread unrest, which worsened after the announcement of the official results of the vote, with demonstrations, street protests, barricades, road closures, looting, vandalisation and destruction of public facilities and businesses. The clashes with police have left more than 300 people dead.

Source: Lusa