Mozambique’s annual growth rate of 8% held steady over a decade is impressive. But Mozambique is no economic miracle. It is a too-familiar story of resource exploitation. Mozambique’s growth is being driven by a one-off extraction of irreplaceable resources, including gas, coal and forests. These valuable resources could drive investment across the economy, but to date there is little sign of ‘trickle down’ beyond a middle class housing and service boom and the spread of import-led consumerism. Short term profit-taking is the business model, rather than investment of the resource dividend.
For every 8 people completing some level of education and entering the potential workforce, only 1 waged job is being created
Despite the seasonal gluts of excellent fresh produce, most fruit and vegetables sold in Maputo markets is imported from South Africa and in supermarkets across Mozambique, not more than 10 genuinely local products can be found on the shelves
The growth of market-oriented agriculture even in the ‘bread-basket’ zones is undermined by the limited capacity (access to land, inputs, finance) of smallholder farmers
Beyond agriculture, people rarely recognise the potential of ‘assets’ at their disposal, even if these assets have generated small scale income for generations
Locally the potential for diversifying the economy is undermined by lack of investment (very expensive short-term loans) for start-up businesses and very limited support for local entrepreneurs.
Our perspective….and what we’re doing
We believe that Mozambique’s route to prosperity must be built on a thriving, dynamic agricultural economy with ‘Breadbasket’ zones meeting growing national demand (including food security needs) and through commercial partnerships with global businesses contributing to meeting changing food supply requirements around the world.
Similarly, Mozambique’s economic development can be boosted significantly by maximizing the potential of natural resources for wealth creation. From forestry to medicinal plants Mozambique has great natural assets most of which are controlled or accessed by poor people. As with agriculture, turning potential into sustained and sustainable wealth creation for the poor will require social entrepreneurship, effective and sustained services, and appropriate (social) investment to create viable and scaling inclusive businesses.
In both urban and rural areas there is need and opportunity to greatly increase the scale of production and marketing of Local goods and services for Local markets. This includes increasing the proportion of goods and services in demand from local consumers produced fully or partially within Mozambique, and in turn filling gaps in the local supply chain (for instance, packaging, technical support services, laboratories etc).
Running through all of this economic change we want to see businesses becoming more inclusive, offering opportunities for workers, suppliers or communities to have a stake.
Our work includes:
SMART agriculture…….In our project ‘Smallholder Market Agriculture for Rural Transformation’, we have enabled 12,500 farmers and their families to build better links with commercial markets. More than half of those farmers now bulk their crops through their Association, and in the most recent season they gained 15% to 30% higher prices as a result. Other benefits include new knowledge on post-harvest handling of crops and other technical issues, as well as planning farming as a business. Our work has helped four of the largest Farmers Associations secure bank finance to enable the Association to buy bulk crops to meet contracts. We’ve also leveraged (by co-funding) more than $80,000 in grants for Associations to build warehouses.
Natural product value chains……Manica Province (the whole Beira Corridor) is blessed with a wealth of natural products with existing and potential markets. Obvious examples include honey and Baobab. Since 2011 MICAIA has provided training and support to more than 1,750 people with an interest in beekeeping. We’ve also created better market access via Mozambique Honey Company, the inclusive business set up with support from and now managed by Eco-MICAIA Ltd. A recent evaluation of MICAIA’s work funded by Comic Relief on honey showed that on average, household income of more than 1,000 beekeepers had increased by 16%, with a resulting increase in household assets and access to services; and 87% of beekeepers in the project reported improvements in wellbeing.
MICAIA is also working on Baobab, the African ‘superfruit’. Long-traded at local level, MICAIA has worked with the exclusively women harvesters in one of the poorest parts of our Province, to improve their understanding of the value chain, organize, and improve their handling of the fruit. We have now linked the women up with the new company, Baobab Products Mozambique, another Eco-MICAIA inclusive business development that will launch products on local and international markets in 2015.