Since the end of the Mozambican Civil War (1977–1992), the country’s economy has grown. Macroeconomic reforms were introduced by the government in 1987 to help stabilize the economy. Because of this, the country’s growth rate has improved dramatically after the 1994 multi-party elections. Inflation fell to single digits in the late 1990s before rising to double digits in 2000–02. Reforms to the tax code, notably the adoption of a value-added tax, have boosted government revenue collection.
SADC Trade Protocol
Mozambique has ratified the SADC Trade Protocol, which aims to liberalize intra-regional trade by establishing mutually advantageous trade agreements and boosting regional investment and productivity. It promotes the elimination of trade obstacles, the simplification of customs procedures, the harmonization of trade policies based on international standards, and the prohibition of unfair commercial activities by the Member States. The Protocol also comprises annexes that define policy on Rules of Origin, customs cooperation, standardization of trade documentation, transit facilities, and trade development, as well as institutional structures for implementation.
Mozambique – Malawi
In December 2005, Mozambique and Malawi signed a preferential trade deal. This agreement was a revision of a previous deal signed with Malawi by Portuguese colonial authorities before Mozambican independence. Beer, some soft beverages, cigarettes, sugar, vegetable oil, chicks and eggs, office equipment, petroleum products, firearms, ammunition, and explosives are all excluded. The origin restrictions in the Mozambique-Malawi agreement are less stringent than those in the SADC Trade Protocol.
US – Mozambique
In 2005, the United States and Mozambique signed a Bilateral Investment Treaty (BIT), which came into effect.
Mozambique is one of the least developed countries on the planet. The United States is the country’s greatest bilateral donor, delivering roughly $560 million in aid each year. The United States is working to improve Mozambique’s investment climate through strengthening democratic institutions, transparency, and inclusive government. Food security, as well as healthcare, education, poverty reduction, and job creation, remain top goals. Mozambique’s reaction to the COVID-19 epidemic was made possible by US healthcare assistance and vaccine donations.
Energy, infrastructure, agriculture, information, and communications technology (ICT), and transportation are just a few of the sectors where Mozambique presents chances for American enterprises. After a slump in 2020 due to the COVID-19 pandemic, Mozambique’s economy has recovered, following a financial crisis started by a $2 billion fraudulent loan scam in 2016.
Mozambique – Zimbabwe
The trade deal will benefit not only the inhabitants of the two countries but also the Southern African Development Community (SADC) as a whole since it will support regional efforts to ease cross-border trade obstacles.
The Mozambique-Zimbabwe Trade Agreement is being implemented at a time when the area is aiming for a Free Trade Area by 2008.
The Mozambique-Zimbabwe bilateral agreement permits duty-free commerce in any commodities produced or manufactured in either country, as long as they match the pact’s local content requirements and are not on the “negative list.”
It allows duty-free export and import of a wide range of items, including mineral and agricultural products, live animals, forest products, fish and fish products, and fish and fish products.
“The trade agreement specifically excludes firearms, ammunition, and explosives, refined or unrefined granulated sugar, soft drinks or aerated beverages, manufactured tobacco, and motor vehicles.” from the trade agreement’s provisions,” the Zimbabwe Revenue Authority (ZIMRA) said in a statement.
China- Mozambique
Relations between China and Mozambique extend back to the 1960s when China began to help Mozambique’s Marxist-oriented FRELIMO party in its fight against Portuguese colonialism. Shortly after Mozambique gained independence from Portugal, diplomatic relations were formally established on June 25, 1975. Mozambique was the thirteenth African country to be included in China’s official list of tourist destinations in November 2006.
China has started offering development aid to Mozambique in addition to trade. The Export-Import Bank of China has provided Mozambique with soft loans for infrastructure development, such as US$60 million in 2006, and has twice forgiven major sections of the country’s debt to China, erasing US$22 million in 2001 and US$30 million in 2007. They’ve also erected a lot of government buildings and public facilities for free, including the national parliament and national stadium.
