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Economic Growth and Trade

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Mozambique economic growth
Farmer incomes rise when they have easier access to markets

USAID works closely with the Government of Mozambique to implement activities that promote increased trade.  USAID’s Trade and Investment Hubs are designed to reinforce regional and bilateral efforts to strengthen Africa's economic competitiveness and assist countries to take greater advantage of the trade opportunities provided by the African Growth and Opportunity Act (AGOA) and other global trade initiatives. The Trade and Investment Hub programs include trade capacity building, improvements to the private sector enabling environment, better market access and opportunities, trade facilitation, food security programs, and export promotion support for African products.

Learn more: Southern AfricaTrade Hub

Although progress has been gradual, Mozambique has been implementing much-needed reforms in its regulatory and investment frameworks. Private-sector economic activity has increased, but privatization of state-owned enterprises has slowed. Foreign and domestic capital are treated similarly in most cases, and trade liberalization has progressed despite the persistence of non-tariff barriers.

Private Sector Development

High transaction costs negatively affect business and trade competitiveness. In a 2016 World Bank report, Mozambique ranked 121 out of 183 countries worldwide for ease of doing business. We help private sector businesses become more competitive, thus generating more trade and investment opportunities. Our programs support policy reforms to make it easier to start a new business, thus increasing the number of small- and medium-sized enterprises and increasing new foreign investment. Over the long term, investments by Mozambique’s private sector will be key to catalyzing economic growth and alleviating poverty.

We focus on increasing growth in the agriculture and tourism sectors, which show strong potential to attract private investment and create jobs. Our programs provide business development services and access to financial services that help small- and medium-sized enterprises become more efficient and productive. In turn, they become more competitive in local, regional and international markets, and better able to attract private investment to help their businesses grow.

Trade and Regulatory Reform

Creating a business and investment climate that is open, transparent and competitive is critical to long-term economic growth. USAID’s trade program works with the Ministry of Industry and Commerce to strengthen its ability to implement reforms conducive to a better business environment and to negotiate and implement regional and bilateral trade agreements. This helps the country become a viable trading partner as it seeks permanent partnership in the Southern African Development Community Free Trade Area, which is essential to increase trade with regional partners. We also support Mozambican business associations to help the private sector’s push to improve the investment environment, reduce obstacles to registering new small- and medium-sized businesses, and decrease business costs and risks. Under the Partnership for Trade Facilitation, USAID will support more transparency and faster clearance times at borders.