The Confederation of Economic Associations of Mozambique (CTA) today asked the World Bank to ease the requirements for accessing financing, particularly for small and medium-sized enterprises (SMEs) in Mozambique.
Speaking to journalists on the sidelines of a meeting with the World Bank, CTA representative Kekobad Patel said that under the new five-year Country Partnership Framework (CPF) of approximately $3 billion (€2.55 billion) recently announced for the country, the conditions to access financing are, in some cases, “prohibitive for SMEs,” which make up the majority of businesses in Mozambique.
“This is one of the concerns the World Bank is currently reviewing: how these facilities can be made more accessible to Mozambican entrepreneurs,” Patel added.
With the proposed approach, there is also the expectation of greater private sector involvement, allowing programs to be more targeted and deliver better results.
“The Mozambican business sector is essentially made up of small and medium enterprises. Solutions will therefore be tailored for them, so they can gain better access to financing,” he explained.
Zarau Kibwe, Executive Director of the World Bank’s First African Constituency, said the meeting also explored potential sectors for new financing.
“We discussed areas where the Bank can support them, starting with agribusiness. As we know, most of the population depends on agriculture, so it is a key sector. The second sector discussed was tourism opportunities,” he explained, adding that the logistics sector was also reviewed as a potential driver to transform the country’s economy.
The discussion also covered ways the World Bank can collaborate with the government and private sector to improve the business environment and support local investment in Mozambique.
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“I think the country has everything it needs to transform the economy,” Kibwe concluded.
Recently, the World Bank announced the provision of €170 million to Mozambique to mitigate the impact of floods and the ongoing rainy season, which since October has killed 242 people and affected nearly 870,000.
“We have an immediate capacity, over the next few months, to mobilize $200 million (€170 million). Depending on needs, we will see how to expand this program,” said Fily Sissoko, Director of the World Bank Group for Mozambique, after a meeting at the Presidency of the Republic of Mozambique in Maputo with President Daniel Chapo.
At the conclusion of the meeting, Finance Minister Carla Loveira highlighted two additional lines under the partnership with the World Bank: one resilience-focused program of $450 million (€382 million) over three years, and an emergency support fund of $20 million (€17 million) already made available for urgent flood response actions.
