“DARING REFORMS” NEEDED, SAYS BUSINESS LEADER

The chairperson of the Confederation of Mozambican Business Associations (CTA), Salimo Abdula, on Tuesday called for “daring reforms to improve the business environment, giving greater confidence in the country, and encouraging new investments in the productive sector”.Speaking in Maputo at the opening of the 12th Annual Conference of the Mozambican private sector, Abdula also called for a drive to reduce the production and transaction costs that make it difficult for Mozambican products to compete.Studies made over the last two years, he said, concluded that “the Mozambican productive sector faces one of the highest cost structures in the region, and the business environment has been improving far too slowly. These two factors combined make our economy uncompetitive”.He called for development of processing industries to accompany the Green Revolution that the government advocates in agriculture, in order “to ensure the transformation, conservation and addition of value to agricultural products”.But that would demand “improving policies for access to land, water, electricity, fuel, improved seeds, bank credit and labour”. It also required agricultural mechanization and the adoption by the government of a new policy to finance agro-business.Much of what could be productive land is currently occupied by people who are not using it, despite repeated threats that they will lose their land titles. Abdula wanted to see some action taken – and he suggested a system of land fines, whereby people who did not use the land allocated to them would be obliged to pay “penalty charges”. And if that did not work, people not using the land (generally members of the urban elites, who may have acquired land for future speculation) should simply have their land titles withdrawn.As for industry, Abdula pointed to the shortage of skilled labour in Mozambique, and the high cost of bank loans. He called for reforms in the educational system so that the schools would produce the type of skilled worker needed by industry. In particular, more public investment should be channeled into technical and vocational schoolsAbdula also suggested the creation of “industrial development funds to meet long term investment needs in strategic sectors”, and urged the government to grant incentives “which would lead businesses to invest in modern technologies”.Despite all that has been said about customs reform, the CTA still found Mozambican foreign trade beset by unnecessary costs and procedures. Abdula demanded that customs officials “must be made to understand how much it costs the country to have merchandise stuck at the frontiers and in the ports because of bureaucratic procedures”.Abdula insisted on the importance of scientific research. “In any sector, increasing production and productivity depends on research”, he said. “Research leads to innovation and improvements in production”.The results of research and other useful information needed to circulate among the Mozambican business class. “Our business people, particularly in small and medium businesses, need access to information on business opportunities, market trends, prices and appropriate technologies”, he stressed.