Friday, March 16, 2018

Five reasons

One of South Africa’s top five African trading partners, Mozambique has been one of the ‘fastest-growing economies’ on the continent for the last two-and-a-half decades. It has outperformed both regional and global growth averages, with rich oil and gas reserves that are attracting substantial investment from across the globe. Additionally, the nation looks set to rise up as the ‘new’ Seychelles or Reunion if the optimism and energy continue in its tourism sector.
Resultado de imagem para maputo cidadeLourenço Sebastião Sambo, Director General of Mozambique’s Investment and Export Promotion Agency (APIEX), says the nation recently hosted a senior South African delegation led by the Department of Trade and Industry. “The delegation was in Mozambique early this month to identify and explore trade and investment opportunities. And later this month, the first ‘Mozvest Conference’ will be held in Cape Town to outline investment opportunities in this African neighbour.”
He says there are solid reasons for South African investors to invest in Mozambique. Here are his top five.
ONE: The growing economy
Mozambique is anticipating investments in the energy sector (electricity) of over US$D10 billion in the coming 10 years as well as significant investment in the oil and gas sector (Anadarko LNG plant), graphite (various mining concessions have commenced), tourism sector – across the country, traversing the extensive coastline – and the agricultural sector. The International Monetary Fund and Mozambique government predict GDP growth of 5.3% in 2018, with inflation expected to be below 10% according to the Governor Central Bank. A Deloitte 2017 report calls Mozambique’s economic prospects positive.
With peace re-established, the country‘s macro-economic stability is secure and Mozambique’s world-class endowments are creating attractive destinations for investment. At the conference, all opportunities will be explored, with advice on upcoming opportunities, benefits and success stories, prospective challenges and agile strategies in terms of finances and legalities.
Resultado de imagem para maputo cidadeTWO: Oil and gas
Mozambique is Africa’s third-largest holder of liquefied natural gas (LNG), with reserves of around 180 trillion cubic feet. Two main consortiums – one headed by the Texas based Anadarko and the other by Italian ENI – will ensure that Mozambique becomes a major exporter by 2023.
Investment opportunities around natural gas abound in areas such as the supply of equipment driven by the construction of gas plants. The LNG development plan includes two 180,000 cubic meter LNG storage tanks, condensate storage, a multi-berth marine jetty, and associated utilities and infrastructure. ENI’s development plan foresees the drilling and completion of six subsea wells in addition to the construction and installation of an advanced technology FLNG with a future onshore liquefaction facility. Further major opportunities exist in the oil and gas sector; for example: Anadarko LNG Plant has pledged US$20bn to its liquefied natural gas (LNG) project.
Nial Kramer, CEO of SAOGA (South African Oil and Gas Activities) says, “Fostering synergy between Mozambique as an economic frontier and SA as a mature economic force will be vital in the development of the gas market in Mozambique and in ensuring that these considerable natural reserves are used as an opportunity to spur inter-regional trade and development opportunities.”
THREE: Mining
Mozambique has commercially important deposits of coal (high quality coking coal and thermal coal), ruby, graphite, iron ore, titanium, apatite, marble, bentonite, bauxite, kaolin, copper, gold, and tantalum. It also holds some of the world’s largest untapped coal deposits. The company Vale from Brazil has made major investments in a coking coal mine. It was followed by some other players from Australia and India. With the current investment in infrastructure in the country, and expectation that mining costs in South Africa will rise considerably over the coming years, Mozambique could gain a regional competitive advantage.
Mining and refinery equipment, maintenance services and machinery, automation equipment and other efficiency improving services will be needed to improve profitability of the current and upcoming mining projects, providing investment opportunities for company with such expertise.
FOUR: Tourism
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The most recent World Economic Forum report on competitiveness called Mozambique one of the top ten tourist destinations that’s expected to record greater growth in demand for leisure travel in the next decade. With pristine beaches and famed hospitality, Mozambique has all the makings of the next ‘Reunion’ or ‘Seychelles.’ The Government of Mozambique has chosen the tourism sector as one of the four priority sectors for investment in the current governmental cycle.
Tourism is also an important source of inclusive business and poverty reduction in Mozambique. This sector can boost competitiveness, expand economic opportunity and provide a pathway to prosperity. Tourism is one industry in the world where the goods or services are consumed at the site of production. It can also be an excellent mechanism for channelling resources from rich to poor. Commercial tourism activities provide an opportunity for local people to participate in direct employment, in providing goods and services to tourism businesses through the supply chain, but also through direct interaction with the tourist (for example: crafts, excursions, food and beverage). The generation of earnings among those local people directly involved with the industry in turn stimulates indirect spend (of wages) in the local economy.
FIVE: Tax credits
Mozambique applies the unilateral method for the avoidance of double taxation of income to resident companies and the permanent establishment of non-resident companies. This makes the trading environment very favourable for corporates.

About the Mozvest conference
The Mozvest conference will elaborate on all fields of prospective investment whilst also providing ample time for networking with some of Africa’s most preeminent individuals along with international guests. The conference will be held at Lagoon Beach Hotel, Cape Town on Wednesday, 22 March 2018. For a full itinerary, list of speakers, and to buy tickets, visit

100% of Mozambican graphite

Junior Triton Minerals has completed the acquisition of an economic interest in the remaining 20% shareholding of Grafex.Triton in February struck a deal with private owner Gregory James Sheffield, under which the company will purchase his 20% interest in Grafex for $1.5-million, taking its own interest in the Mozambican graphite developer from 80% to 100%.
Resultado de imagem para graphiteTriton MD Peter Canterbury said on Tuesday that the company would need to seek formal approval for the transfer of the interest under Mozambique legislation to complete the transfer of the legal title; however, it would enjoy full economic benefit to the shares until a formal approval was received.
“We are pleased to announce this step towards consolidation of the ownership of Grafex and its graphite projects in Mozambique. Acquiring full economic ownership of the projects comes at an exciting point in the development of the Ancuabe project and will greatly assist in our efforts to secure approvals in Mozambique, as well as offtake and financing negotiations to support an investment decision in the second quarter of 2018.”A recent definitive feasibility study determined that Ancuabe would require preproduction capital of $99.4-million to build a mine that is capable of producing about 60 000 t/y of graphite concentrate. The study estimates a pretax net present value of $298-million, a pretax internal rate of return 36.8% and near-term payback of 3.8 years.

EUR 51.7M works in Port of Maputo

Resultado de imagem para porto de maputoThe Maputo Port Development Company (MPDC) has announced today that Mota-Engil will carry out 51.7 million Euros’-worth of work, rehabilitating one kilometre of mooring berths from June onwards.Once rehabilitated, the quays will be able to receive larger ships, as provided for in the port development masterplan, the company says in a statement.The rehabilitation follows the dredging of the port access channel in January 2017, at a cost of EUR 70 million.Combined, the works, scheduled from June until the end of next year, pave the way for a 40 percent increase in the cargo capacity in Maputo and 55 percent of the cargo capacity in Matola.In 2017, MPDC registered a 22 percent increase in volumes handled in Maputo, with 18.2 million tons of cargo against 14.9 million in the previous year. The port expects to handle around 22 million tons of cargo this year.