Date: 13 August 2007
Transcription
Date: 13 August 2007
Date: 13 August 2007 The Investor - Mozambique Legal and Business information as received from MozLegal for the period: Edition 53 to Edition 58 MCLI takes pleasure in forwarding to you the very valuable Mozambique Legal and Business information newsletter as received from MozLegal. MCLI greatly appreciates the partnership with MozLegal and thank them for making this very informative newsletter available to the Maputo Corridor Interested Readers. Please do not hesitate to forward your comments with regards to this MCLI initiative to us at [email protected] For any questions kindly contact MozLegal directly as per below: Director – Adrian Frey Editor - Joaquim Falé ===================================================== Mozlegal Lda Rua General Pereira D´Eça 90 C. P. 1839, Maputo, Mozambique Tel +258 21 496 900 Fax +258 21 496 802 E-mail [email protected] Web mail: www.mozlegal.com Thank you for working with MCLI towards the Maputo Corridor becoming the first choice for the region’s importers and exporters. Brenda Horne CEO THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique August 7 2007 58th Issue EDITOR’S NOTE Dear readers, The hotly debated new Mozambican Labor Law has been published in record time. Less than two weeks after the recent approval by President Armando Guebuza, the law was published in the Boletim da República under the title Law 23/2007 of August 1. The law will enter in force on October 30, 2007. Please see the article under the section, Legal News by Mozlegal for more information. Sincerely, Adrian Frey MOZAMBIQUE REVIEW Population census begins Mozambique's Third General Population and Housing Census began last Wednesday, and among the first households to be counted in Maputo was that of President Guebuza. The chairperson of the National Statistics Institute, Joao Loureiro, took about 20 minutes to ask Guebuza all the census questions. The President's answers, like those of any other citizen, are confidential, since the census data are used for aggregate, statistical purposes, and never to pinpoint individuals. In a message to the nation broadcast on Tuesday night, Guebuza said the involvement of all citizens was crucial to the success of the census. He urged all residents in the country, Mozambicans and foreigners alike, to welcome the duly identified census takers into their homes. (aim) GOVERNMENT Guebuza receives Angolan Prime Minister Angolan Prime Minister Fernando da Piedade dos Santos ("Nando") has called for relations between Mozambique and Angola to be strengthened so that they produce visible results. Piedade dos Santos declared "our bilateral relations are on the right track, but we need to carry on strengthening them so that they provide palpable and visible results". The Angolan Prime Minister congratulated Mozambique on holding the forum which he described as "an excellent window of opportunity for exchanging experiences and acquiring knowledge so that we may continue to stand for good governance and transparency". (aim) Government 'On Right Path' in Anti-Corruption Fight' The Mozambican government is on the right path in defining clear policies for the fight against corruption, claimed Prime Minister Luisa Diogo. Closing an extraordinary session of the National Anti- Corruption Forum, which she chairs, Diogo praised the determination and quality of the interventions made by members of the Forum during the two day meeting. She believed that this reflected the "unequivocal determination" of the Mozambican people to overcome corruption and absolute poverty. (allafrica) DONORS Calls for change to Bretton Woods voting structure A draft memorandum addressed to the heads of the World Bank and the IMF, under discussion in Maputo at the meeting of the "African Caucus" of Finance Ministers that began last Monday, calls for an increase in the representation and voting power of Africa in the two Bretton Woods Institutions. The memo warns that the role and effectiveness of the IMF and World Bank has been weakened by a continued erosion of voice of African countries in decision making. The draft memorandum seeks to redress this by strengthening the voting power of the poorer countries through an increase in the number of basic votes in the World Bank, by increasing the number of African chairs on the Boards of the World Bank Group, and by increasing the overall number of African staff at all levels. (aim) Finance Ministers discuss IDA replenishment The "African Caucus" of finance ministers and central bank governors has stressed the need to ensure the 15th replenishment of the International Development Association (IDA), the arm of the World Bank that provides soft loans for developing countries. The spokesperson for the meeting, Mozambique's National Treasury Director Antonio Laice, said that the caucus wanted to see an increase of 20 per cent in the resources for IDA-15, which will mean an increase in IDA funding of 26.3 billion special drawing rights (about 39.8 billion US dollars). Over 50 per cent of the IDA-15 money is likely to be spent in Africa. Since the replenishment depends on the IDA donors of the developed world, the caucus is urging African countries to undertake serious advocacy work with the donors, stressing how urgent a full replenishment of the IDA is to the continent's efforts to achieve the Millennium Development Goals. (aim) IMF did cap Mozambican aid spending The Independent Evaluation Office (IEO) of the International Monetary Fund has recognized that the IMF did indeed prevent Mozambique, and many other African countries, from spending all the aid available in the late 1980s and early 1990s. The director of the IEO, Thomas Bernes, told a Maputo press conference last Wednesday that his team investigating the IMF's impact on aid to sub-Saharan Africa had found that "the Fund's medium term forecasts were too conservative, thus biasing spending in a conservative direction". One of the lesser-known aspects of IMF interference in developing counties is that it caps the aid they can spend, usually on the grounds that if all the aid available is spent, then inflation will rise. (aim) World Bank loan for higher education The Board of Directors of the World Bank last Tuesday approved a loan of 15 million US dollars to Mozambique to help fund the government's Higher Education Project. The loan, from the International Development Association (IDA), the Bank's soft loans facility, is additional funding to cover the financial hole left by the project going over budget on building work and equipment. The Bank claims that the loan will enable the scaling up of the higher education, science and technology programs, which includes the provincial scholarship fund, the competitive Quality Enhancement and Innovation Facility and the National Research Fund. Disadvantaged science students and top performers in science and technology will also benefit from the additional credit. (aim) ECONOMY Mozambique’s cashew nut production set to rise this year Production of cashew nut in Mozambique could increase by 5,000 tons to reach 80,000 tons this year due to replanting of many trees and control of crop disease, media have reported. The Notícias newspaper, citing sources in the National Cashew Institute (Incaju), said 3.5 million cashew trees have been sprayed this year to combat fungal disease affecting the plants, particularly in the flowering season. The spraying program was begun in May and Inacaju said the initiative is most concentrated in the provinces of Zambezia, Sofala, Nampula and Cabo Delgado due to the strategic importance of the cashew harvest to these regions. (macauhub) Cabo Delgado attains record cotton production The northern Mozambican province of Cabo Delgado attained this year a record production of cotton of 43,000 tons, compared with 23,000 tons in the previous season. Cabo Delgado provincial governor Lazaro Mathe told AIM that "this production is a landmark in the province. For the first time Cabo Delgado production of raw cotton has overtaken that of all other provinces". He said that the Plexus-Mocambique company, that promoted cotton production in the province, invested about eight million US dollars in seeds and other inputs, which it provided on credit to the peasant growers. It was this that guaranteed a good agricultural season. In Cabo Delgado, cotton is produced mainly in the districts of Balama and Montepuez, and the main market is Britain. (aim) Mozambique approves SA investment in Port of Maputo The government of Mozambique has given the green light for a US$ 80 million investment by logistics and shipping firm Grindrod of South Africa to enlarge coal and vehicle terminals in the port of Maputo. Mozambique’s transport and communications minister, Antonio Munguambe, announcing the authorization last week, said the South African company, with a 95 percent stake in the coal terminal and a 12 percent shareholding in the port of Maputo, wants to expand the harbor facilities to ease congestion in South Africa’s docks. One of Maputo’s advantages is its proximity to South Africa’s Gauteng province, the location of the country’s commercial and economic capital, Johannesburg. (macauhub) MINING AND ENERGY Canadian firm to make biodiesel in Mozambique Energem Resources of Canada has acquired a 70 percent shareholding in a renewable energy venture in Mozambique that will use jatropha to produce biodiesel. The Canadian firm said last week that under the terms of its purchase, it will invest up to US$ 5.5 million, including the planting of an additional 5,000 hectares of jatropha and the acquisition of another 60,000 hectares to produce the biomass crop. Energem said its acquisition was part of a strategy to focus on hydrocarbons infrastructure projects and the biofuels sector. As part of this strategy, the Canadian company has created a new division, Energem Biofuels, based at an ethanol plant at Kisumu in Kenya. (macauhub) Corridor Sands funds anti-malaria campaign Corridor Sands, the company holding the concession to exploit what is believed to be the world's largest deposit of titanium bearing mineral sands, in the southern Mozambican district of Chibuto, last Wednesday donated a check for 390,000 US dollars to finance an initiative to combat malaria. The two year project is intended to reduce the incidence of malaria in Chibuto by 20 per cent. In 2005, there were 95,000 notified cases of malaria in the district, rising to 97,000 cases in 2006. Speaking at the launch of the program, the director of the Corridor Sands project, Alan Cuddon, noted that in Beluluane, on the outskirts of Maputo, a similar project, largely funded by the MOZAL aluminum smelter, had, over an eight year period, led to an 80 per cent reduction in malaria cases. (aim) Tata Steel acquires stake in Riversdale's Mozambique coal project Tata Steel has acquired a 35 per cent stake in Australian firm Riversdale Mining Ltd.'s coal project in Mozambique for Australian $100 million (about $85 million). Tata Steel would now be a strategic investor in the project that is fully owned by Riversdale through its subsidiary, Tata Steel said. Riversdale Mining Limited, incorporated in 1986, is listed on the Australian Stock Exchange. Tata steel, which recently completed acquisition of the Anglo-Dutch steelmaker Corus Group for about $12 billion, is the world's sixth largest steel-maker. (domain-b) New viability study on Mozambican heavy sands project ready by March 2008 A new study on a revised project to mine titanium-bearing heavy sands at Chibuto in southern Mozambique will be published in March 2008, the company involved in the venture has said. Alan Cuddon, CEO of Corridor Sands, said that the new design for the project involves building a smelter for ores at Beluluane in Maputo province near the Mozal aluminum smelter, instead of the building of a mineral port at Chonguene. Cuddon told state news agency AIM that the new site for a smelter had the advantage of the required energy for the project, around 120 megawatts, as well as a nearby port to export minerals from. Deputy-Minister of Mineral Resources Abdul Razak said the revised project by Corridor sands would save around 50 percent on the original investment of the venture, estimated at around US$ 1 billion. BHP Billiton leads the Chibuto project with a 90 percent shareholding, the remaining 10 percent of shares held by the Industrial Development Corporation of South Africa. (macauhub) Baobab Resources gets encouraging results on Seymour Prospect, Mozambique Baobab Resources PLC reported encouraging results from surface sampling at the Seymour Prospect and from underground sampling of the Mundonguara mine in Mozambique. The samples provide 'strong additional evidence for the presence of copper and gold mineralization over 1 kilometer to the west of the Edmundian Shaft,' the company said. The company also found certain 'historic workings' that most likely represent production that commenced around the turn of the last century, which further increases the along-strike and down-plunge resource potential of the Mundonguara project. (hemscott) SA firm in Mozambican joint gold venture Great Basin Gold of South Africa has teamed up with GS Minas e Refinaria of Mozambique to explore for gold in a concession 80 kilometers south of Manica, company sources said. Great Basin, listed on the Toronto and Johannesburg stock exchanges, will hold an 80 percent stake in the joint venture and will have exclusive rights to explore all GS Minas properties. The South African company is committed to making exploration expenditures of US$ 2 million over three years on the Tsetsera property in Manica and other concessions held by GS Minas. Great Basin is the second South African firm to begin gold exploration in Mozambique following the acquisition of a concession by Pan African Resources four kilometers north of Manica for commercial viability studies. (macauhub) JSW Steel steps up mining in Mozambique JSW steel has acquired two more licenses for exploring coal mines in Mozambique, as it boosts efforts to build coal supplies to meet its expanding steel production. The Sajjan Jindal-led company is expanding production to 10 million tons from the current 3.8 million tons and needs more coal that will burn iron ore and increase its steel capacity. JSW already has an agreement with a local player in Mozambique to conduct due diligence on a 6,900-hectare site that could be later mined for coal. JSW Steel has the option to carry out detailed exploration studies and prepare mining plans, after it concludes preliminary surveys. If successful, the company can opt to buy the mines and apply for mining license and operations. (economictimes.indiatimes) REAL ESTATE NEWS BY MOZAMBIQUE PROPERTY Real Estate News by Mozambique Property There are many families looking to buy houses in the Maputo and/or Matola area. Do you have a house that you wish to sell? Please visit us directly at our offices in the Hotel Cardoso or contact Alexandra Santos at [email protected] or +258 82 369 8745. Our website is also worth a visit; log on to www.mozproperty.com. LEGAL NEWS BY MOZLEGAL Hiring of Foreigners simplified under new Labor Law The Labor law currently in force makes it obligatory for companies to obtain authorization from the Labor Ministry for any foreign staff they wish to employ. If foreigners are employed without such authorization the company is fined by between 10 and 80 times the statutory minimum wage, and the foreigner is suspended until his/her situation is regularized. The new Labor law, expected to enter into force before the end of the year, will greatly simplify the process of hiring foreigners. Under the new regulations, a small company (with up to 10 workers) may recruit 10 per cent of its work force (i.e. one worker) from abroad, without the need for authorization. Medium sized companies (between 10 and 100 workers) can have eight per cent foreign nationals in the workforce, while for large companies (over 100 workers) the figure is five per cent. In these cases, the Ministry is merely notified - the question of authorization only arises if the companies wish to recruit more than this quota. (Mozlegal Labor Law department- Carlos Martins) National Campaign for the divulgation of the new Labor Law The Center for Labor Arbitration (CAL), a Mozlegal initiative in partnership with GTZ-APSP, will launch a campaign for the divulgation of the new Labor Law on 17 August 2007, in Maputo. The first information session will be conducted in Portuguese, followed by a session in English on 5 September 2007. In partnership with Tudo Legal, the new Labor law will be presented in the provinces on the following dates: Inhambane on August 21; Beira on August 28; Nampula on August 30; and Chimoio on September 4. Click here for more information on the seminar. If you would like to register, contact [email protected]. New Mozambican Labor Law one step closer to entering into force The socio-economic and political evolution of Mozambique has created a need for a new legal framework to govern work, employment, and social security. To this end, the new Mozambican labor law, passed by the Mozambican parliament, Assembly of the Republic on 11 May 2007 and approved by President Armando Guebuza on 18 July 2007, has now been published in the Boletim da República under Law 23/2007 of August 1. Legally, all laws enter into force 90 days after publication in the Boletim da República, which brings the date of adoption to 30 October 2007. For a free copy of this legislation in English or Portuguese, contact Adrian Frey at [email protected]. New Fiscal Regime for Mining Activities The existing fiscal regime for mining was a target of revision which has resulted in the recent adoption of Law 11/2007 of June 27 that revokes articles 27 and 31 of Chapter III of the Mining Law. The new law fixes the rates for the calculation of the production tax, based on the type of mineral product used for the production. It also fixes the surface tax rates with respect to the type of license and mineral in use. (Mozlegal Mining department) Regulation for Technical and Health Security in Mining Activities Recently published was the Decree 61/2006 of December 26, which approves the Regulation for Technical and Health Security in Mining Activities in Mozambique, applicable to prospection, research and exploration of mineral resources. This regulation defines the standards and rules to guarantee the health and security of workers in the realization of mining activities, including the prevention of accidents and occupational hazards; and the guarantee of hygienic conditions in areas where mining activities are conducted. (Mozlegal Mining department) Regulation of Mining Law In response to growing needs of the rapidly expanding Mozambican Mining sector, it became necessary to revise the existing Mining legislation. Decree 62/2006 of December 26 was recently published and approved, putting into force the new Regulation for Mining Law. This decree brings innovations relating to the certification of mineral products and the procedures for exportation of minerals for laboratory analysis. In addition, it develops the Financial Management of the activity under the supervision of the General Inspectorate of Mineral Resources and Energy (IGREME), guaranteeing state compensation in cases where agreements are not observed by title holders. For more information on this new regulation, contact [email protected]. (Mozlegal Mining department) TOURISM Mozambican tourism boom pits locals against foreigners Stretches of pristine beaches wind around Mozambique's coast, a slice of paradise where trouble is brewing as foreigners cash in at the expense of locals from a boom in tourism. Practically destroyed during a 27-year civil war ending in 1994, tourism in the former Portuguese colony has skyrocketed in recent years, as holidaymakers are drawn to its white sands, crystal clear waters and relaxed atmosphere. However locals are railing against an influx of foreigners, mostly from neighboring South Africa, accused of entering into dodgy land deals with Mozambicans and flouting environmental concerns as they set up business. Read the full article here. (mail and guardian) Mozambique Airlines increases flights to South Africa LAM – Mozambique Airlines, in partnership with Mex – Mozambique Express, on Saturday, 4th of August 2008, launches flights between Maputo and Vilankulos to Lanseria in South Africa. The flights will be made by an aircraft of the type Jetstream J41, with capacity for 29 passengers, operating on Mondays, Tuesdays and Saturdays. The Lanseria Airport is located near Sandton city, and offers faster access to Pretoria, Westrand, and Midrand regions, with greater comfort for passengers. (travelvideo) OVER THE BORDER SADC expects 7% growth this year The Southern Africa Development Community (SADC) expected a growth rate of 7 percent in 2007, but faced challenges of high inflation, the SADC executive secretary said at the weekend. Tomaz Salomao hailed economic development in the region, saying SADC economic performance had improved in output growth and per capita income in 2006 compared with 2005. "The SADC average real GDP [gross domestic product] grew at about 5 percent in 2006, the same as in 2005," he said. Angola has achieved the highest GDP annual growth rate of 18.6 percent this year, with Mozambique and Malawi at 7.9 percent and 7.4 percent, respectively. Excluding Zimbabwe, the SADC's inflation remained at 17.3 percent. Zambia will host the SADC summit from August 16 to August 18. (AFP) Zimbabwe farmers wait out Robert Mugabe For many of Zimbabwe's 4,000 white farmers forced off their land by President Robert Mugabe's chaotic and violent land reforms, the chance to start afresh in a neighboring country was too good to pass up. In return for the cash incentives of tobacco companies, the farmers agreed to grown a set number of acres of tobacco to sell to the companies, but the hotter and wetter climate of Mozambique meant that the tobacco yields were far less than expected. Soon the farmers fell into debt until many stopped growing tobacco altogether, whereupon the tobacco companies took them to court to seize their equipment. At least 70 farmers have returned following the collapse of their new farming ventures and are hoping that Zimbabwe’s downward economic spiral will hasten the end of Mugabe’s rule. (telegraph) THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique July 31 2007 57th Issue EDITOR’S NOTE Dear readers, The Solutions “Mozambique’s One-Stop Business Center’s” website at www.clubofmozambique.com is your daily source for news, information, and events on Mozambican business and investment. Just three months after its launch, the site has already received over 20,000 hits. Please keep in mind that the site is updated daily. Thank you for your continued interest and feedback. Sincerely, Adrian Frey MOZAMBIQUE REVIEW Fire devours petrol station Flames towered into the sky above the Maputo Bay on Friday night and loud explosions could be heard across the city. The fire was the result of a short circuit at a petrol station in Catembe, the district that faces downtown Maputo across the bay. According to workers at the petrol station the accident happened at about 18.30, as a tanker truck was refilling the fuel deposits. A short circuit in the electric pumping mechanism gave off a spark which set alight a trickle of petrol on the ground, and soon the whole filling station, owned by the company Total, was ablaze. The flames devoured the deposits of petrol, diesel and kerosene, and spread to bottle of cooking gas stored up nearby. For more than 15 minutes these were exploding like giant firecrackers. Four people were injured, but there are no reports of any fatalities. (aim) Cardoso assassin tries to escape again Mozambique’s most notorious assassin, Anibal dos Santos Junior (better known as “Anibalzinho”), serving a sentence of 30 years for his part in the murder of the country’s top investigative journalist, Carlos Cardoso, in November 2000, attempted to escape from his cell in the Maputo City Police Command last weekend. This is the fourth known attempt by Anibalzinho to escape from that cell since the Maputo City Court, in January 2006, found that he had indeed recruited and led the death squad that murdered Cardoso. Interior Minister Jose Pacheco has announced that Anibalzinho will shortly be returned to the top security prison, where a “special cell” is being prepared for him. (aim) Natural disasters linked to climate change Mozambique's Environment minister, Luciano de Castro, has suggested that the natural disasters that have struck the country in recent years are linked to man-made climate change. Mozambique’s contribution to the greenhouse gas effect is miniscule given that the country has very few heavy industries however, "climate change and its effects know no borders", said Castro, "and do not discriminate between those who have contributed most to global warming and those who have contributed least". Antonio Queface, a physics lecturer from Maputo's Eduardo Mondlane University, said Mozambique should take adaptation measures to face climate change. Such measures would include investing in drought resistant crops and water retention technologies, in order to deal with the likelihood of lower rainfall in the future. (allafrica) GOVERNMENT India to cooperate with Mozambique in prevention of labor disputes The Indian government wants to cooperate with the Mozambican Labor Ministry in efforts aimed at preventing labor conflicts involving Indian investors or citizens in Mozambique. Indian High Commissioner Rajinder Bhagat announced the initiative at a meeting earlier this week with Labor Minister Helena Taipo. Bhagat pointed out that it was important that any foreign investor or citizen recognized that each country has its own laws which, therefore, must be complied with. India is Mozambique’s traditional cooperation partner in many areas, notably education, information and communication technologies, agriculture, water supply and transport and communications. (cpi) New date for provincial elections Mozambican President Armando Guebuza has postponed the first elections for provincial assemblies from 20 December 2007 to 16 January 2008. Guebuza made this change, in a Presidential dispatch issued on Thursday night, on a proposal from the National Elections Commission (CNE). Foreign donors have, to date, declined to finance the elections. (allafrica) Minister demands better performance from police Mozambican Interior Minister Jose Pacheco challenged the police last Saturday to guarantee more security to the people if they want to see their own living conditions improve. “If we want to improve our living conditions, we must guarantee security. With security we can attract investments, and with investment the state will be able to increase our resources”, he said. He stressed that, although official statistics indicate a decrease in overall crime figures nationally, there has been a sharp rise in violent crime in recent months in the capital, and in the neighboring city of Matola. (aim) DONORS Chinese firm builds water supply system in Mozambique A new system to supply drinking water to the city of Quelimane, capital of Mozambique’s Zambezia province, cost 320 million meticais (about US$ 13 million) and is benefiting around 70,000 people. Inaugurated last week by President Armando Guebuza, the new system means residents of Quelimane now have drinking water 24 hours a day. The previous supply was restricted to 8 percent of the population and only available 8 hours daily. The project was funded by a World Bank loan to Mozambique’s state Water Supply Investment Fund (FIPAG) and built by the Sinohydro Corporation of China. (macauhub) Non-Paris Club members close to agreeing to cancel Mozambique’s debt Following a series of debt cancellations under the Heavily Indebted Poor Countries (HIPC) debt relief initiative, Mozambique’s foreign debt has fallen substantially to only about two billion. Finance Minister Manuel Chang is quoted as saying the country’s current priority is to negotiate with non Paris Club creditors such as Hungary, Rumania and Bulgaria. According to Chang, negotiations with these countries are at an advance stage. Before HIPC, Mozambique’s debt amounted to more than six billion dollars. (cpi) France funds rehabilitation of Limpopo National Park The French Development Agency (AFD) will fund restoration and ‘biodiversity and ecosystem’ protection projects in the Limpopo National Park in Mozambique’s Gaza province, reported the newspaper, Notícias. AFD has pledged 11.5 million euros to finance a highway between Mapai and Massingir. Management of the Limpopo National Park said the participation of the French state development agency would strengthen the capacity to implement modernization projects in the reserve, which forms part of the Great Limpopo Transfrontier Park, along with South Africa’s Kruger National Park and the Gonarezhou National Park in Zimbabwe. (macauhub) World Bank launches Innovation Fair The World Bank, in partnership with Mozambican institutions, launched in Maputo last Monday the "Innovation Fair 2007" open to Mozambican and foreign individuals and organizations. This is a contest aimed at stimulating innovation and creativity under the theme 'Information and Communication Technologies (ICTs) for Rural Development'. Khovete Panguene, an official of the World Bank, told reporters that the contest aims to encourage the use of ICTs for rural development, and the winners will be awarded between 10,000 and 20,000 US dollars to implement their projects. To enter the contest, the participants must present, by 27 August, a description of their idea. The proposals may be presented in partnership between institutions, and can be fully original or based on ideas that are already in use somewhere else. (allafrica) ECONOMY Mozambique says its foreign debt “is sustainable” Mozambique’s foreign debts of US$ 2 billion are at “a sustainable level”, Finance Minister Manuel Chang has said. “We have reached a sustainable debt stock and our goal is to remain prudent so as to not return to the previous situation of being highly indebted,” added Chang. To keep its debts in check, Maputo will continue to exercise care in taking on new financial commitments, said Chang. Mozambique was among the Heavily Indebted Poor Countries (HIPC) until 1990 with debts in excess of US$ 6 billion. Mozambique’s finance minister said that the country’s internal debts were presently around US$ 211 million. (macauhub) Mozambique agricultural exports earn the country about $680 million Mozambique annually earns about 680 million dollars from exports of agricultural products to countries of the Southern African Development Community (SADC), according to Antonio Fernando, Minister of Industry and Commerce. Fernando said the government will now bet on consolidating the country’s agricultural potential ahead of regional integration by increasing production and productivity. He added that efforts would also be focused on access roads. According to the minister, Mozambique currently exports a total of 15 agricultural products including ginger, tomatoes, potatoes, onion and maize to SADC states. (cpi) FNB launches Mozambique operations First National Bank, a unit of South Africa's second biggest banking group, FirstRand, announced that it had launched its Mozambican operation, FNB-Moçambique. The launch follows parent company FirstRand's 139 million rand purchase of an 80 percent stake in Banco Desenvolvimento e Comercio (BDC) from majority shareholder Montepio Geral Group in Portugal and other shareholders. FNB – Moçambique, the new designation of BDC, pledges to bring new dynamism to the institution, through an expansion of its services. The bank also pledges new type of services including those of leasing and insurance. Mozambique rail company keen to cut Spoornet wagon link Mozambique's state-run railway company said on Friday it was investing $30 million to upgrade its commercial fleet in a move to cut $100 million in wagon hiring fees charged by South African rail freight firm Spoornet. Port and Railways company, CFM, plans to refurbish 820 refurbished wagons with the investment, as an addition to the 600 wagons currently in operation, spokesperson Antonio Libombo said. Modernising Mozambique's rail network is a key part of Mozambican President Armando Guebuza's efforts to boost foreign investment and trade. (reuters) Xinavane sugar refinery in Mozambique to produce 180,000 tons in 2009 Production of sugar at the Xinavane plant in Mozambique’s Maputo province is predicted to reach 180,000 tons in 2009, compared to the 61,000 tons produced in 2005, a company executive said. Antonio Ferronha, financial director of the sugar refinery, told Noticias newspaper that the company aimed to put 74,000 tons of sugar from this year’s harvest for sale on national and international markets. To reach its boosted production target in 2009, the Xinavane refinery will receive investments of over US$ 100 million from its shareholders, Tongaat-Hulett of South Africa (with an 88 percent stake) and the Mozambican state (12 percent of shares). (macauhub) Railway Partnership in Region The railway companies of Mozambique, South Africa, and Swaziland have signed an agreement on the exchange and training of their crews as part of an operational partnership that also calls for the repair of engines and wagons in any of the three countries, with international quality standards. Under the agreement, Mozambican train drivers have started operating with Swazi and South African engines, and operation manuals are being translated to be used in future training programmes in the three countries. Cited in Monday's issue of the Maputo daily "Noticias", the executive director of the southern branch of the Mozambican railway company (CFM-Sul), Joaquim Zucule, said that this partnership comes within the context of the regional integration of the Southern African Development Community (SADC). (allafrica) Gateway Communications acquires GS Telecom In a $36.5 million transaction, Gateway Communications acquired the leading provider of data connectivity services to corporate customers and telecommunications operators across Africa, making Gateway the largest provider of voice and data connectivity services in sub-Saharan Africa. The acquisition was recently announced in Maputo to existing GS Telecom clients, where some of the advantages mentioned were closer customer support, increased scale, greater coverage, broader service range, and increased investment. Gateway COO, Mike van den Burgh, said of the company’s expansion, "Because we are a customer driven organization, and because Mozambique is such a high growth market, it is very important that we should have strong presence here." MINING AND ENERGY Fuel Prices Fall The Mozambican government recently cut the price of diesel by 2.2%. According to a release from the Ministry of Industry, diesel falls in price from 28.14 to 27.52 meticais a liter. Petrol too falls in price, but by only 0.5 per cent, from 33.89 to 33.73 meticais a liter. There is no change in the price of kerosene, at 20.25 meticais a liter, while LPG cooking gas goes up in price from 41.28 to 41.66 meticais a kilo. The prices of the other main liquid fuels, jet fuel and fuel oil, are no longer fixed by the government, but have been liberalized. The prices announced by the Ministry are valid for the port cities of Maputo, Matola, Beira and Nacala, where the fuels are unloaded. Elsewhere fuel distributors are allowed to add their transport costs when calculating the final price. (aim) Mozambican gold mine to cost $68m Pan African Resources plans to build Mozambique's first gold mine at a cost of $68 million (R464 million). Jan Nelson, the chief executive of the Metorex-controlled company, said yesterday that Pan African should start building the Mozambique venture in the third quarter of next year. The Manica project would be an open-pit mine, employing up to 300 people. It would cost about $40 million to construct two processing plants and $28 million to dig the mine. The mine could produce 87 000 ounces of gold a year. The Manica site has a gold ore resource of 1.5 million ounces at a grade of 3 grams of gold per ton of rock extracted. (businessreport) Reserves of Moma Heavy Sands may last for 120 years The exploitation of the titanium-bearing heavy mineral sands in the district of Moma, in the northern Mozambican province of Nampula, could continue for over 100 years. Originally it was thought that the useful life of the Moma mine would be 20 years. But subsequent discoveries of further reserves have radically changed the forecast, and it is now believed that exploitation of the heavy sands could last for 120 years. The new reserves are in the area of Nantaka, and are larger than those at the locality of Toquito, where the original prospection took place by Kenmare Resources, the Irish company that won the Moma concession. (aim) Sasol Petroleum concludes seismic surveys in southern and central Mozambique The petrochemical company Sasol announced it has concluded off-shore seismic surveys on blocs 16 and 19 in the southern and central provinces of Inhambane and Sofala. Sasol recently embarked on an additional search for hydrocarbons in the area adjacent to the current Temane gas fields, which are among the largest natural gas reserves in the world. Sasol plans to hold public meetings in Inhassouro and Maputo in early August to present the findings of the prospection activities and share information regarding the ongoing additional surveys. (cpi) REAL ESTATE NEWS BY MOZAMBIQUE PROPERTY New Mozambican Properties for sale Mozambique Property has added several attractive properties to its website at www.mozproperty.com. By visiting the site, you will be exposed to pictures and information about premier properties for sale in Mozambique including commercial beach front property, islands, substantial plots for large scale farming, and beach side homes. This month, the Mozambique Property team took on Alexandra Santos who will be responding to your inquiries at [email protected]. LEGAL NEWS BY MOZLEGAL Policy of Land Order The policy of Land Order constitutes a set of directives that allow the Government to define the general objectives of the instruments of land order. These instruments are meant to ensure a better distribution of human activities in land, the preservation of nature reserves and special zones, and the sustainability of human development, while honoring international treaties and accords in the area of land. This policy document was recently approved under Resolution 18/2007, published in the Boletim da República no. 22, Series I of 30 May 2007. For more information on the land activity designations, contact [email protected]. (Tudo Legal News) Mozambican legislation in English Mozambique is currently undergoing a great deal of legal reform, hailed by many as a step in the right direction for doing business in the country. Mozlegal, through their services to investors and businesspersons in Mozambique recognized the need to increase access to Mozambican legislation, particularly in English. Earlier this year, the firm introduced the service Tudo Legal Blue, where for USD300/yr, clients receive over 120 legislation translated to English including updates. Subscribers also have access to model contracts and agreements, FAQs, and receive the newsletter Tudo Legal News. For information on how to subscribe, contact [email protected]. Law Passed to Stop Human Trafficking Over 1,000 Mozambicans, including children, are trafficked to South Africa every year where they are forced into prostitution or to provide free or cheap labor. In response, Mozambique's government last week approved a new law which will make human trafficking a crime punishable with long prison sentences. The Mozambican bill will be adopted during the next sitting of parliament in September this year. Chimedza comments that "this is a major achievement, especially as up until now there has not been one conviction for these kinds of activities in Mozambique." (macauhub) TOURISM Diving in Africa There are many incredible diving spots in Africa and the top 3 would have to include the Red Sea in Egypt, the Seychelles and Mozambique's Archipelagos. Mozambique offers some of the best unspoiled diving in the world. The main sites include Barra Reef which also offers excellent fish viewing opportunities for snorkelers. The Bazaruto Archipelago is home to hundreds of species of colorful fish as well as humpback whales, marine turtles, spinner, humpback and bottlenose dolphins, large game fish like marlins and barracudas and the endangered dugong. The Archipelago was hit by a cyclone in February this year -- but is looking to re-open its resorts by October. Baixo do Pinda just north of Nacala has the potential to be one of the most beautiful and popular dive sites in the world, but few people have yet discovered it. Read more here LAM expands electronic ticketing to Beira, Nampula and Pemba LAM – Mozambique Airlines is expanding its electronic ticketing to other parts of the country as part of its strategy to reduce unnecessary costs and of efforts to comply with the recommendations of the International Air Transport Association (IATA). LAM says that as from the first fortnight of August electronic tickets will also be issued from the central and northern cities of Beira, Nampula and Pemba. The airline company launched the new issuing system in Maputo last February. (cpi) OVER THE BORDER Lonrho’s LonZim banks £32.3 million Lonrho Plc ("Lonrho"), the African conglomerate with a diverse portfolio of investments, recently announced that its newly established subsidiary LonZim Plc (“LonZim”) has raised an initial £32.326 million (US$66.234 million) from a number of existing institutional shareholders of Lonrho by issuing 46,180,958 LonZim shares. Lonrho represents 39.4% of that company and currently holds all board positions. LonZim intends to raise additional funds and seek a listing on a major stock exchange over the coming months. LonZim’s principal focus will be to acquire and invest in key assets in the property, infrastructure, hotel and commercial sectors in Zimbabwe and neighboring countries including the important access corridor to the coast at Beira in Mozambique. 500 firefighters arrive to fight Mpumalanga fires Firefighters were battling to contain raging fires in Mpumalanga on Tuesday, Working on Fire said. Spokesperson Val Charlton said firefighters were deployed to tackle fires that had broken out in the Lowveld. "About 500 firefighters have arrived to contain fires. There are about five fires to be put out," she said. A series of fires had caused damage in Mpumalanga, Kwazulu-Natal as well as in Swaziland. The weekend's fires claimed at least 13 lives in KwaZulu-Natal, and six firemen died in Mpumalanga. (iol) THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique July 24 2007 56th Issue EDITOR’S NOTE Dear readers, Solutions “Mozambique’s One-Stop Business Center’s” is not only committed to attracting investment to Mozambique, but we are dedicated to ensuring that our clients have successful and sustainable businesses. If you are interested in a new investment or are looking for partnerships in an existing one, contact [email protected] or [email protected]. Visit our site at www.clubofmozambique.com for your daily source of business news, information, and events. Sincerely, Adrian Frey MOZAMBIQUE REVIEW Period for the registration of foreigners extended The National Directorate of Immigration has decided to extend the period for the registration of foreigners to 13 August 2007. The decision was taken to allow that more foreigners be reached by the process. The extension of the period results from the fact that a large portion of the foreign community in Mozambique has still not been censused, in comparison to the forecasts. For more information on this process, contact [email protected] or [email protected]. GOVERNMENT Mozambique pledges to host annual African Development Bank meeting in 2008 Mozambique will stage the 43rd Annual General Meeting of the African Development Bank in May, 2008 under an accord signed in Maputo. The deal, signed last Friday by Mozambican Planning and Development Minister Auiba Cuereneia, states that Maputo “will organize the ADB’s AGM in 2008, ensuring all logistics for the meeting in coordination with the bank.” Maputo also pledged to make all necessary national contacts to ensure participation of key sectors at the event, particularly from the areas of transport, communications and hotels. “We will ensure that delegates have a secure environment in Mozambique. At the moment, we are working in all areas to guarantee the success of the Maputo meeting,” said the minister. (macauhub) DONORS Too Many Donors Spoil the Aid An excessive number of aid donors is hampering efforts to make development assistance more effective, a new study has found. After examining European Union aid to Cambodia, Mozambique and Peru, the Overseas Development Institute (ODI) in London calculated that these countries have to deal with 15-17 bilateral donors from the EU, as well as the European Commission. The figure is even higher if bodies representing regions like Catalonia in Spain or Flanders in Belgium -- both of which have offices in Mozambique -- are included. Click here to read the full article. (ipsnews) World Bank approves Mozambique, Malawi electricity loans The World Bank's Board of Directors last Wednesday approved two loans to fund the building of new transmission lines between Mozambique and neighbouring Malawi. The loans, from the International Development Association {IDA}, the Bank’s soft loans facility, are of 45 million US dollars to Mozambique and 48 million to Malawi. They are intended to develop the regional electricity grid with the aim of increasing industrial competitiveness and fostering economic growth. Mozambique will use the fund to build a 220 kV transmission line from the Matambo substation in Tete province to the Malawian border 135 kilometres away. As part of the project, Mozambique’s publicly owned electricity company, EDM, will receive capacity building support. (aim) ECONOMY More healthy signs for Mozambique economy According to information released by the minister of finance in Mozambique, Manuel Chang, his latest figures show a reduction in the inflation rate to 3.7% in June from 9.4% in June 2006, while annual growth is of 7% to 8%. Gateway Communications acquires GS Telecom In a $36.5 million transaction, Gateway Communications acquired the leading provider of data connectivity services to corporate customers and telecommunications operators across Africa, making Gateway the largest provider of voice and data connectivity services in sub-Saharan Africa. The acquisition was announced last week in Maputo to existing GS Telecom clients, where some of the advantages mentioned were closer customer support, increased scale, greater coverage, broader service range, and increased investment. Gateway COO, Mike van den Burgh, said of the company’s expansion, “Mozambique is a rapidly expanding economy which translates to an increased demand for services. Because we are customer driven, Mozambique is a natural place for us to be.” MTL connects network to Mozambique Malawi Telecommunications Limited (MTL) is looking into installing a cross-border fiber-optic link with its counterpart in neighbouring Mozambique, Telecomunicações de Moçambique (TDM). The proposed connection will be between Mwanza in Malawi and Zobue in Mozambique. MTL chief technology officer Peter Boll said the USD25 million project would connect the neighbouring countries and eventually allow onward connection to the rest of the world. (telegeography) All Mozambique’s provincial capital linked by optical fiber by 2008 The publicly-owned Mozambique Telecommunications Company (TDM) plans to link the country’s 10 provincial capitals by optical fiber before the end of 2008. The news was announced recently by TDM Chairman Joaquim de Carvalho after inaugurating the optical fiber link between the central cities of Beira and Quelimane, in Sofala and Zambezia provinces respectively. The first phase of the project, a link between Maputo, Xai-Xai, Inhambane, Vilankulo and Beira, was concluded in 2002. (cpi) Millennium BIM opens another branch in rural Mozambique Mozambique’s leading commercial bank has inaugurated a new branch in the administrative post of Xinavane, in Manhiça district, just outside Maputo city as the government heightens its call for banks to go to the rural areas. Rural Mozambique has not been properly covered by banking services since the end of the 16-year war of destabilization in late 1992. However, one by one, the banks are realizing the potential of the rural areas where the majority of the population lives. Xinavane is a strategic agricultural area well known for sugar cane plantations. (cpi) Portugal’s Teixeira Duarte wins Mozambican ferry terminals projects Portuguese construction firm Teixeira Duarte has been awarded a US$ 6 million project to rebuild the main road ferry terminals in Inhambane and Maxixe. The construction projects are seen as vital for the economic development of Inhambane province, among Mozambique’s poorest regions. Besides renovation of the ferry stations’ quays, the modernization scheme includes new waiting rooms for passengers, public toilets and access roads. In Maxixe, an old quay will be demolished and replaced with a new structure designed with a 10-ton capacity. A new pontoon dock will allow boats to moor at any tide level. In Inhambane city, the 200-meter bridge will get a covered walkway to protect users from other activities aimed to improve shipping operation standards. (macauhub) SA and Mozambican companies to invest US$ 16 million in private hospital in Maputo A company from Mozambique is joining forces with a South African partner to build a private hospital in Maputo, company sources have said. Isidora Faztudo, CEO of Hospital Privado de Maputo (HPM), said last Thursday that the US$ 16 million project was a joint venture between Lenmed Health of South Africa, with a 60 percent shareholding, and Invalco of Mozambique, holding the remaining 40 percent stake. The project, added Faztudo, has already been given the go-ahead by the Mozambican government and now awaits approval from Maputo City Hall. The new hospital is expected to be operational 18 months after its construction gets underway. (macauhub) MINING AND ENERGY CVRD to resettle families off Mozambique coal mine Brazil's Companhia Vale do Rio Doce plans to spend $30-million to resettle 1 200 families occupying a mining site in Mozambique, clearing the way for development of the project. "We have our teams working in the district of Inhangoma to demarcate the areas where the local population would be resettled in a process to be concluded before the end of the year," CVRD official Andre Vasconcelos was quoted. Some of the money would be used to provide housing, sanitation, schools and water supply for the families now living at the Moatize mine development in the Northern Province of Tete. (miningweekly) Coal shortage to Tete companies The company "Minas de Moatize", in the western Mozambican province of Tete, is finding it difficult to honour its commitment to supply Mozambican clients with coal, because it has prioritized exports. The coal exports have put Minas de Moatize on a collision course with the company Mozambique Leaf Tobacco, which complains that it is not receiving enough coal for its tobacco processing plant in Tete city, while dozens of truckloads of coal can be seen heading for the borders. All the coal mining companies that have been operating recently in Moatize are small operations. That is all set to change, with huge planned investment by the Brazilian mining giant, the Companhia Vale do Rio Doce (CVRD). (allafrica) LEGAL NEWS BY MOZLEGAL President of the Republic puts new Labor Law into effect President Armando Guebuza formally put the new Mozambican Labor Law into effect on 18 July 2007. The hotly debated Labor law was approved by the Mozambican parliament, Assembly of the Republic, on 11 May 2007, and has now been verified by the Chief of State that it is in line with the fundamental law. Following the President’s approval, the law will be published in the Boletim da Republica which could take two months, said the Coordinator for the Center for Labor Arbitration-CAL, Miguel Pinheiro. The law will enter into force 90 days after its publication in the Boletim da Republica, which brings the expected date of adoption to December 2007 or January 2008. The new legislation is available at the CAL website www.arbitrationmz.com. Banking Institutions are the target of inspection The Ministry of Labor announced last week that from 17-28 July 2007, it would be conducting a nationwide inspection on the banking sector to verify the compliance of the labor law and regulations within the sector. In Maputo City, the General Labor Inspection will begin its program at the Millennium BIM headquarters. The Labor Law campaign, to be launched by the Ministry of Labor, will be proceeded by a meeting between the Ministry, the National Syndicate of Banking Employees and the Millennium BIM Directorate. The meeting will close with a press conference at the Ministry of Labor. (CAL) Seminar on the Madrid System held in Maputo On 11-12 July 2007, the World Intellectual Property Organization (WIPO) and the Industrial Property Institute (IPI) of Mozambique organized a seminar on the Madrid System for the International Registration of Marks and the importance of patents for the creation of small and medium enterprises. The system offers multiple advantages in the process of registration and payment of taxes, through its streamlined approach to international registration of marks. Based on WIPO studies, the Madrid System has clear advantages to developing countries, using the success of the mark GRINGO as an example. Their motto to countries, companies, and individuals is “Do not waste time or money investigating things that have already been invented or discovered”. Mozlegal’s Department of Industrial Property Recognizing the importance of Industrial Property in the strengthening of Mozambican business, Mozlegal’s Department of Industrial Property (DIP) was launched in 1999, when the registration of industrial property rights was reinitiated under the Industrial Property Code, Decree 18/1999 of May 4. Since then a new decree has been approved, Decree 4/2006 of April 12, and the Department has grown substantially in capacity and services. DIP offers a range of legal services including the registration of marks, patents, designs, industrial models, logos, and establishment names. It also has a litigation office that handles provisory oppositions and refusals. The department has an office created specifically to counter piracy, offering professional assistance to interested companies. For more information on the Department of Industrial Property, contact [email protected] or [email protected]. Industrial Property Code The new Industrial Property Code, approved by the Decree 4/2006 of April 12, has entered into force. The new code has introduced significant alterations to the procedures concerning the modalities of industrial property rights, mainly with regards to marks. For more information, contact [email protected] or [email protected]. (Tudo Legal News) New legislation for mining sector published In response to growing needs of the rapidly expanding Mozambican Mining sector, it became necessary to revise the existing Mining legislation. The Mining law would have to adapt to the new realities and establish rules for technical and health security in the sector. As a result, a new Regulation for the Mining law and a Regulation of Technical and Health Security in Geological-Mining activities were published and have been in force since December 26, 2006. The fiscal regime for mining activities was also a target of revision and in response to this, the new tributary regime for the sector recently entered into force on June 27, 2007. For more information on Mining Legislation, contact [email protected]. Tudo Legal News Tudo Legal News is another breakthrough service offered by the Mozlegal/Pandora Box initiative, Tudo Legal. The objective of this new Tudo Legal service is to keep readers updated on all legal news in Mozambique. Tudo Legal News is free to all members of the Tudo Legal Project. For more information on how to join Tudo Legal, contact [email protected] or visit www.clubofmozambique.com. TOURISM Mozambique adventure With its remote, tropical appeal, marzipan-white beaches, inland mountains, and offshore islands that make up an archipelago of natural beauty, Pemba in northern Mozambique is the gateway to an exclusive new adventure destination. Now serviced twice weekly from Johannesburg by Airlink, this undiscovered part of Africa has been opened up to travel, romance, adventure or simply switching off. At the gateway to the Quirimbas Archipelago, the modern traveler can get marooned in style in exclusive resorts, including Ibo Island, Matemo Island, Medjumbe Island, Quilalea Island, Vamizi Island and Londo Lodge Airlink flies the Pemba route on Tuesdays and Saturdays (with two return flights on Saturday). Visit www.flyairlink.com or contact Airlink marketing on 011-961-1700. Mozambique to build hotels nationwide Mozambique’s tourism ministry is launching a $55 million national project for the construction of quality hotels in all regions of the country, said Tourism Minister Fernando Sumbana. The project, dubbed Capulana, will be financed from the National Tourism Fund and is aimed to develop tourism in areas of the country where there is little of no quality accommodation. Medium-sized hotels will be built with power and water supply systems to ensure quality and efficiency of service, Sumbana said. Mozambique’s tourism ministry says the hotel-building scheme comes at an unprecedented “boom” time for the industry. (macauhub) Investment in infrastructure behind the current tourism boom Tourism Minister Fernando Sumbana says the massive investment made by the government in infrastructure, notably roads, is behind the current boom of tourism in Mozambique. Sumbana says that in 2006 alone, the government invested some 80 million dollars on infrastructures. According to the Minister, the sector currently employs over 30,000 people following investment projects along the country’s 2,600km Indian Ocean coastline endowed with magnificent beaches and islands. Developments have also been taking place inland. (cpi) Government provides $54 million to rehabilitate national parks The Mozambican government is to provide US$ 54 million to upgrade the country’s national parks and safeguard the wildlife in the reserves, an official has said. Albino Mahumana, General Director of local tourism, said that although the government is still seeking financial backers for the scheme, the funds will solely be provided by the Mozambican state and the five-year project is expected to begin by the end of the year. Maputo’s goal is to rehabilitate the country’s various national parks to restore the wildlife balance in the reserves. “It is also hoped that Mozambique will develop its status as an African safari destination,” added Mahumana. (allafrica) OVER THE BORDER One-stop border post workshop for Lebombo-Ressano Garcia The Maputo Corridor Logistics Initiative (MCLI) was well represented at the July 19 one-stop border post (OSBP) workshop in Maputo, with over 20 members from both SA and Mozambique - representing the road, port, rail, terminals, agents, shipping lines, transporters, financial institutions, information technology and cargo owners participating. The objective of the workshop – funded by DFID - was to facilitate a common understanding of the notion of the one stop border post and to consult stakeholders on the roadmap for the proposed OSBP at Lebombo-Ressano Garcia. Said MCLI CEO, Brenda Horne: “This is a matter of real urgency considering that we have experienced an 80% increase in passenger volumes since the abolition of visa requirement in our two countries in April 2005.” THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique July 17 2007 55th Issue EDITOR’S NOTE Dear readers, As part of Solutions “Mozambique’s One-Stop Business Center’s” commitment to keeping you abreast of the Business and Investment opportunities in Mozambique, please see below for some recently published tenders. Visit the website at www.clubofmozambique.com to find a list of published tenders. Sincerely, Adrian Frey Tender notice: Auditing Consultancy Services The Government of Mozambique, with the support of the Cooperation Partners, is making efforts aiming at determining the amount of Value Added Tax (VAT) due by State Institutions, in the context of invoices issued in public works contracts financed with external and Government funds. The determination of this amount will serve as the basis for the adoption of measures for the solution of the problem of the accumulated VAT payment arrears. For that purpose, the Government intends to contract consultancy services for which the objectives and tasks are defined under TENDER Nº 01/ATM-DGI/07. (aim) Tenders for vehicles and air and sea freight services Jacana Real World Development, a Mozambican based NGO and member of MCLI, has put out a number of tenders for vehicle supply (click here), the provision of Air Freight Services (click here) and Sea Freight Services (click here). Should you be interested, please communicate directly with Jacana at the numbers given on the tender documents. To read more about Jacana please visit their website www.jacanaworld.org. (mcli) MOZAMBIQUE REVIEW Muslims Call for Election Postponement The Islamic Council of Mozambique is asking the government to change the date of the country's first elections for provincial assemblies, on the grounds that it is likely to clash with a major Islamic holiday. The date announced by President Armando Guebuza for the elections is 20 December. But that date is also the most likely date of Eid al-Adha, one of the most sacred days of the year for Moslems. This is a real problem, since Moslems account for about 18 per cent of the Mozambican population, according to the 1997 census. Observant Moslems will prioritize their religious duties rather than voting, and so holding elections on 20 December risks an unnecessary increase in abstention. (allafrica) GOVERNMENT Mozambique plans to purchase another dredger The Mozambican government is planning to purchase another dredger as part of the efforts to ensure easy access to the country's ports. The chairperson of the board of directors of the state owned dredging company EMODRAGA, Tayob Adamo, recently announced that the government has been negotiating with potential partners for support in this purchase. Adamo explained that the dredger to be acquired will have a capacity of 2,500 cubic meters. In the central port city of Beira, Japan recently donated the dredger, "Alcantara Santos", with a capacity of 1.000 cubic meters. Purchasing another dredger is part of a series of projects that, taken together, "are the solution that will increase our capacity to operate at national level", said Adamo. (aim) DONORS Agreement Signed With Millennium Challenge Corporation The Mozambican government and the United States Millennium Challenge Corporation (MCC) last Friday signed an agreement under which the MCC will make a total of 506.9 million dollars available to Mozambique over the next five years. The money is mostly to be spent on water supply, sanitation and roads in four provinces north of the Zambezi River (Zambezia, Nampula, Cabo Delgado and Niassa). The agreement was signed on the premises of the US State Department by Mozambique's Planning and Development Minister, Aiuba Cuereneia, and the MCC Chief Executive Office, John Danilovich. Witnessing the signing ceremony were Mozambican President Armando Guebuza and the US Deputy Secretary of State, John Negroponte. Read more about the Millennium Challenge Corporation on this article of the Washington Post. (allafrica) Italy supports Mozambican state budget The Italian government has pledged 11.4 million Euros (about 16 million US dollars) for direct support to the Mozambican state budget for the next three years. An agreement was signed in Maputo to that effect last Wednesday between Italian deputy Prime Minister and Foreign Minister Massimo D'Alema and Mozambican Foreign Minister Alcinda Abreu. Abreu said that this money will help the government implement its poverty reduction strategy. The agreement “represents the commitment of the Italian government to help us fight against the poverty that still affects most of our people”. For his part, D'Alema said that his government is happy with the consolidation of peace and democracy, and the economic advances Mozambique has made in recent years. (aim) Chinese university supports creation of agricultural college in Mozambique An agricultural college will open in the coming academic year in Mozambique’s Inhambane province under an accord signed between the Eduardo Mondlane University in Mozambique and China’s Sichuan Agricultural University. Mozambican news agency AIM said the accord commits China to supply all types of support to the new college, aimed to train students in aspects of rural development. The president of the Mozambican university, Filipe Couto, said the agreement with China also involved support to the faculties of Agronomy, Veterinary Sciences and Engineering. (macauhub) ECONOMY Mozambique sees more Chinese investment Mozambique expects to attract more Chinese investment and to benefit from Beijing's new $5 billion China-Africa investment fund. Foreign Minister Alcinda Abreu said Mozambique was set to strike high-profile deals with new Chinese partners. "The Chinese people are our friends dating back to our liberation struggle, and today they are supporting our struggle against poverty," she told Reuters. China launched the $1 billion first phase last month of the new fund to help finance domestic firms' investments in Africa. Financed by China Development Bank (CDB), the fund is part of Beijing's pledge to double its aid to Africa. China has been offering low interest loans, debt relief and other incentives to increase its influence in Africa, in return for access to natural resources, notably oil, to feed its booming economy. (reuters) SADC free trade will not affect tariff revenues – Mozambican Customs Liberalization of trade in the Southern African Development Community (SADC) from 2008 will not impact on the level of customs revenues collected by Mozambique, the country’s national customs services has said. Under a SADC trading accord, from next year foods including meat, fish, eggs, food oil, potatoes, vegetables, fruit and yoghurt will cease to carry customs duties. The assistant-director of Mozambique’s customs services, Julio Nunes, said that despite a predicted 20 percent fall in tariffs revenues, he was optimistic that state tax revenues would remain high, as VAT will remain on many imported goods and more businesses will become liable for this tax. Under the SADC protocol, tariffs will be removed from consumer products from 2008 as part of a scheme to create a Free Trade Zone, to be followed by a Customs Union and Common Market in 2015, Monetary Union in 2016 and a common currency in 2018. (macauhub) Port of Maputo recognized for strategic location and potential The Port of Maputo in Mozambique is fast becoming a viable alternative to Durban Harbor in Kwa-Zulu Natal for handling large cargo volumes from the Southern African Development Community (SADC) region, according to SABC news. Maputo is Southern Africa's nearest deep water port to Asian markets and boasts a $200 million investment project, which will be completed in the next three years. In addition to South Africa, industries from Swaziland, Zimbabwe and Botswana also use the port. The Maputo Port Development Company (MPDC) was awarded a 15-year concession to manage the port in 2003. It is registered in Mozambique and is backed by a consortium of European Union investors. (mcli) A former general goes into aviation Retired General Joao Américo Mpfumo is to be the representative of four companies (Avstar Holding Pty, Kuzwayo Enterprises Ltd, SBR Capital Ltd and Mozinvest) which created the company Mozavstar in Maputo in mid June. The new company’s mission statement is scheduled domestic air transport and chartered air transport. The largest shareholder in Movastar is Avstar Holding Pty with 35.5%. It is a South African company which owns Avstar Aviation in Durban whose director is Rory Loader. Last year Avstar Aviation acquired 15% in the local low cost company 1Time and participated in an attempt to launch Victoria International Airlines in Uganda with other investors. (africaintelligence) AUTOVISA presents the Mozambican market with new car models The Mozambican market has just received two new models of vehicles 4X2 and 4X4 of Chinese make with engines from the respected Japanese makes Isuzu and Toyota. These are the ZNEN vehicles which have imposed themselves on the international market and now available on the Mozambican market through AUTOVISA. ZNEN is a make that offers, not only on the Mozambican market but the rest of the world, the best quality versus price relationship on the competitive 4X4 vehicle market. Two models are as from now present in Mozambique, namely ZNEN Pick up, with Isuzu engine, and ZNEN SUV, with a Toyota engine. (cpi) Forestry Company established in Niassa A new forestry company, Malonda Treefarms, was formally established last Monday, although it has in fact been operating in the northern Mozambican northern province of Niassa since January. The company has been set up by the Mozambican Malonda Foundation in partnership with the Norwegian concern, Treefarms. It has an initial share capital of 500,000 US dollars, 80 per cent provided by the Norwegians and 20 per cent by the foundation. Treefarms managing director, Mads Aspren, announced that it will operate initially in an area of 46,000 hectares, in the Niassa districts of Lichinga, Sanga, and Muembe. (aim) Tax on diesel for fishing vessels to be reduced The Mozambican government is studying ways to reduce the tax on diesel used by vessels fishing for prawns. Fisheries Minister Cadmiel Muthemba told AIM that this measure aims at solving the crisis the fishing companies are facing. Some claim that the high costs of fuel are bankrupting them. The tax is currently fixed at 3.73 meticais per liter; however, businesses in fisheries, agriculture and industry have already received tax reductions, and are only paying half this amount. Nonetheless, the fishing operators claim that it is still too much. “I hope to have some solutions before the end of this year, to enter into force by 2008”, said Muthemba. Muthemba acknowledged that fuel accounts for about 50 per cent of the operational costs of prawn fishing. (aim) MINING AND ENERGY The new scramble for Africa In the not-too-distant past, Africa was a hot spot of mineral exploration and mining extraction. But unrest and political instability on the continent in more recent decades caused many mining companies to withdraw, resulting in not only a decline in production, but also an underinvestment in prospecting, particularly through the deployment of modern exploration techniques. However, the landscape is changing, with greater political stability emerging at a time when the demand for mineral resources is growing strongly, on the back of a seemingly insatiable raw- materials appetite from China. This is leading to a strong recovery in prices, which some believe could continue for some years yet. Click here to read the full article. (miningweekly) Guebuza Invites U.S. Companies to Prospect for Oil Mozambican President Armando Guebuza has urged American oil companies not to be left behind in the current race to prospect for hydrocarbons in the Rovuma basin, in the far north of Mozambique. Guebuza was speaking in Washington last Thursday at a seminar on business opportunities in Mozambique. The geology of the Rovuma basin suggests that oil and natural gas may well exist there, and so far five companies have won rights to prospect in on and off shore blocks. Only one of these, the Houston-based Anadarko, is from the U.S.: the others are ENI of Italy, Artumas of Canada, Norsk Hydro of Norway and Petronas of Malaysia. Guebuza said there was space for other companies to prospect for oil, and announced that shortly Mozambique would be putting other blocks up for tender. (allafrica) Government committed to the production of biofuels The Mozambican government is seriously committed to a program to produce bio-fuels, and says it will strive to create all the necessary conditions for this end, according to Science and Technology Minister, Venâcio Massingue. Massingue called on the contribution of farmers, industrialists, distribution companies and researchers. Studies ordered by the Energy and Agriculture Ministries presented in Maputo last Wednesday, by consultants from the United States company Ecoenergy, show that Mozambique has the potential to produce 40 million liters of bio-diesel and 21 million liters of ethanol a year. If you are interested in investing or knowing more about Mozambican biofuels, contact Solutions, “Mozambique’s One-Stop Business Center” at [email protected] or +258 82 402 3573. Deadline for Biofuel Strategy The Mozambican government has given a deadline of two months for consultants from the American company Econenergy to deliver their proposal for a biofuels strategy and policy for Mozambique. According to Antonio Saide, the National Director for new and renewable sources of energy, in the Ministry of Energy, such a strategy document is a fundamental step in drawing up a viable program for the production of ethanol and bio-diesel. The consultants have already produced one study on Mozambique’s biofuel potential, which suggests that jatropha, ricin, African palm, and coconuts can be used to produce bio-diesel, while ethanol can be based on sugar cane, maize and cassava. The challenge now is to identify which of these should be used, bearing in mind the viability of production and the quality of the end product. (aim) Coaltrans South Africa 2007 A must attend for all those interested in the coal industry, the Coaltrans South Africa 2007 will take place on 4-6 September 2007 at the Intercontinental Sandton Sun & Towers, Johannesburg, South Africa. To receive a €150 discount on the standard rate, you must register before 20 July 2007. For more information, contact Josef Lanjri at [email protected]. Click here for full conference details. (mcli) LEGAL NEWS BY MOZLEGAL Portuguese Company Fined for Violating Labor Law The Portuguese building company Tamega, after paying a heavy fine for several violations of Mozambican labour legislation, has promised Labor minister Helena Taipo that it will clean up its act. According to a Labour Ministry press release, Taipo received a promise from Tamega company director Antonio Teixeira Jose de Sousa that the management will correct all the anomalies detected. Sousa thought the crisis in Tamega's Mozambican operations serious enough to fly from Lisbon to meet with Taipo. Tamega's Mozambican workforce had denounced racism and discrimination by the Portuguese managers. When the General Labor Inspectorate investigated, it found that the workers' protests were well founded. Contact [email protected] or miguel.pinheiro@mozlegal for information on the Mozambican Labor Law. Bill repealing law on Economic crimes ruled unconstitutional For the first time, Mozambique’s Constitutional Council has thrown out as unconstitutional a bill passed by the country’s parliament, the Assembly of the Republic. The bill in question was debated by the Assembly in March, and repeals laws on economic crimes, one from 1982 and one from 1987. Introducing the bill in the Assembly, the Minister of Industry and Trade, Antonio Fernando, declared that the laws being revoked were “out of date” and any real crimes they sanctioned were covered in the Penal Code and the 2004 anti-corruption law. But Attorney-General Joaquim Madeira and President Armando Guebuza feared that repealing the laws, without putting anything in their place, risked creating “a legal vacuum”, and decriminalizing a range of damaging and fraudulent behavior. This fear was confirmed by the Mozambican Constitutional Council. (aim) TOURISM Maisha Spa for Polana Serena The Polana Serena Hotel in Maputo has a new spa, named ‘Maisha’, which means ‘life’ in Swahili. The spa has been built in the style of a sultan’s palace. All treatments take place in private mosaic-patterned rooms, each with its own changing and washroom facilities. Signature treatments include deep-tissue massages, ‘ritual coconut milk’ body wraps, ‘Andean hot-stone massages’ and ‘salt, ginger and lemon body rubs’. All treatments make use of all-natural essential oils, such as frankincense and juniper. (travelinfo) Londo Lodge specials for Mozambican residents Londo Lodge is an exclusive beach & bush resort north of Pemba, Mozambique. Set on a peninsula surrounded by blue Indian Ocean waters and East Africa's finest beaches, this private boutique resort is hidden amidst lush virgin African baobab bush and abundant coral reefs. Londo Lodge has only six luxury villas to guarantee full exclusivity and privacy. Experience the breathtaking sunset views over the Pemba bay area, delicious seafood, superb diving, immaculate service and true romance. The lodge is currently offering a super discount rate of $200USD per person for Mozambican residents. For more information, contact [email protected]. (eurotravel) National Tourism Day to be held in Manica Province Mozambique this year will celebrate tourism during its National Tourism Week from 23-29 September 2007, with the main events coinciding with World Tourism Day on 27 September. Each year the event is hosted by a different province, where this year Mozambique Tourism week will be held in Chimoio, in the central province of Manica. The organizers of this year’s events are the Ministry of Tourism (MITUR), the Manica Provincial Directorate, and select members of the business community. Activities include Motocross, a fashion show, basketball game, fishing competition on the Chikamba dam, 4 x 4 rally from Chimoio to Chimanimani and several evening functions which showcase Mozambique’s tourism industry. For more information, contact Monty Hunter at [email protected] or email [email protected]. (monty hunter) Mozambique fines illegal tour operators More than 100 tourism operators in Mozambique have been fined a total of $250 000 for operating without the proper documentation. Orlando Candua, Inspector general in the Ministry of Tourism said most of these operators had set up establishments in Maputo, Gaza and Inhambane province, the country's top tourist destinations. This was found after the ministry carried out inspections last year. In Mozambique tourism is one of the fast developing sectors in which the government has introduced incentive to operators, but most of these investors were not willing to register properly. For more information on government incentives for tourism, contact [email protected] OVER THE BORDER FACIM 2007: Mpumalanga Pavilion The Mpumalanga Economic Growth Agency (MEGA) will once again be hosting a Provincial Pavilion at the annual Maputo International Trade Fair – FACIM taking place from the 27th August to 2nd September 2007. Following on last year’s success, MEGA in their role as the official Trade and Investment Promotion Agency for the Province of Mpumalanga, South Africa, would like to extend an invitation to the provincial business community to be part of the Mpumalanga Pavilion at FACIM 2007. MEGA will be sponsoring the exhibition costs of 20 companies who would like to promote and sell suitable products and services into the Mozambique market. Space is limited to 20 Mpumalanga-based companies, so if you are interested, please complete this registration form and fax back as soon as possible. For more information, contact Andrew Bütler at [email protected] or +27 82 895 6433. Extended Border Hours Fail Mozambique's attempt to expand opening hours to midnight at the Ressano Garcia border post with South Africa has failed due to lack of cooperation from the South African authorities, reports Monday's issue of the Maputo daily "Noticias". Initially, it was planned to extend opening hours at the border crossing from 22.00 to midnight as from 1 July, under an agreement between the two governments to that effect. According to the head of Mozambican immigration at Ressano Garcia, Orlando Cossa, on 1 July the Mozambican officials did all work until midnight - only to find that the South African side closed their gates at 22.00. The same thing happened on the following days, and so the Mozambican side too felt obliged to return to the previous timetable. "It makes no sense for us to close at midnight, if on the other side of the border they're closing at 22.00", said Cossa. (allafrica) THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique July 10 2007 54th Issue EDITOR’S NOTE Club of Mozambique News and Information portal Dear Readers, In May 2007, the Club of Mozambique officially launched its news and information portal at www.clubofmozambique.com. The website is “your entryway to Mozambique”. To stay abreast of the Mozambican business, investment, and tourism headliners, visit the site once in the morning and once in the afternoon, as the information is constantly updated. Over the past few months, we have listened to your comments and suggestions on ways to strengthen the site to better serve the business and investment community. The site now boasts over 15,000 hits thanks to your interest. For more information on the Mozlegal initiative, Club of Mozambique, email [email protected]. Adrian Frey MOZAMBIQUE REVIEW Don’t build the house from the roof downwards The Executive Secretary of the Southern African Development Community (SADC), Mozambique's former transport minister Tomaz Salomão, brought a blast of common sense to the discussion on the "United States of Africa", when he declared that it is a bad idea to build houses starting from the roof. Speaking to Mozambican reporters who are covering the summit of the African Union in Accra, Salomão said the continent should first consolidate peace and political stability, and build up the various sub-regional economic communities, before moving towards the huge challenge of a continental government. "You don't start building a house from the roof downwards", he stressed. "You start a house with the foundations, and the more solid the foundations are, the more firm and lasting will be the building. That is how the African Union should proceed". (aim) GOVERNMENT Mozambique commits to gradual liberalization of air space Mozambique will liberalize its air space in stages, Transport Minister Antonio Munguambe said at a recent conference organized by the Confederation of Mozambican Business Associations (CTA). Among the steps already taken was the 2004 licensing of the private airline company Air Corridor, following revocation of a decree that gave the publicly owned Mozambique Airlines (LAM) monopoly along the domestic backbone of Maputo-BeiraQuelimane-Nampula-Pemba. He said a gradual liberalization would prevent the collapse of the national air companies, which could lead to increased unemployment. He encouraged national carriers to seek strategic partnerships with their regional counterparts. (cargoinfo) Mozambican debt to Angola should be converted into Angolan property, PM says The US$50 million owed by Mozambique to Angola should be converted into Angolan property in Mozambique, Mozambique’s prime minister, Luísa Diogo told Angolan radio station Ecclesia. Saying that the Angolan gesture was of capital importance, Diogo added that the two countries were in negotiations to reach an agreement of that kind. The prime minister also said that the Angolan and Mozambican Finance Ministries were analyzing documents in order to “reconcile the debt.” (macauhub) North and South of Mozambique to be linked by road in 2009 A direct road link between the north, center and south of Mozambique is expected to be completed in 2009, the Mozambican Public Works and Housing Minister said in Maputo last Wednesday. Felício Zacarias, who was speaking at the ceremony to instate the new board of the National Roads Administration (ANE), said that the aim was to ensure that in 2009 people could travel from Maputo (south) to Cabo Delgado (north) and vice versa in any type of vehicle at any time, which would be possible when the bridge over the river Zambeze was finished, as well as other important work on national road number one. (macauhub) DONORS No Donor Money for Provincial Elections Not a single foreign donor has yet offered any money to finance Mozambique's first elections for provincial assemblies, scheduled for 20 December, reports the latest issue of the "Mozambique Political Process Bulletin", a usually well- informed publication issued by the Association of European Parliamentarians for Africa (AWEPA). The combined cost of the 60 day voter registration (20 August-18 October) and the December elections is estimated at 44 million US dollars. But only 12 million dollars is available from the Mozambican state budget. In previous Mozambican elections, one of the major donors has been the European Commission - but this time the Commission had informed the government that it would not be providing any funding. (allafrica.com) World Bank provides $100m for Mozambican roads The World Bank agreed on Monday to give Mozambique $100-million in credit to help upgrade its road network, most of which was damaged and neglected during a 17-year civil war that ended in 1992. Mozambique will be exempt from interest and have 40 years to pay back the funds to the World Bank's International Development Association, said Michael Baxter, the Bank's director for Mozambique, Zambia and Zimbabwe. Mozambique's government sees road and bridge construction and modernization as key to boost economic growth in the Southern African nation, which relies on agriculture and tourism for the bulk of its foreign exchange earnings. (mail and guardian) Italy supports rehabilitation of justice infrastructures The Italian government has granted about two million meticais (80,000 US dollars) for the rehabilitation of the Chihango education centre, on the outskirts of Maputo, and one section of the Maputo minors' court. The Permanent Secretary of the Justice Ministry, Angelo Sithole, and the representative of the United Nations Development Program (UNDP) in Mozambique, Ndolamb Ngokwey, signed the contract under which the Italian company CMC will carry out the rebuilding work. Rehabilitating the two buildings is part of the Program to Strengthen Children's Justice in Mozambique, estimated at 2.8 million US dollars, which started two years ago and is financed by the Italian government. (aim) Mozambique needs $150 million a year for education Mozambique is looking to donor nations for at least $150 million a year to expand its education network, its prime minister said last Tuesday. Luisa Diogo told Reuters the funds would be needed to meet the southern African country's U.N Millennium Development Goals, a global campaign which includes fighting poverty and improving education with a 2015 target date. The funds would be invested in infrastructure projects and teacher training programs, said Diogo. Diogo said the government would also tap the private sector to assist in the education program. (reuters) ECONOMY Cooperation with India ‘Very Positive’: Luisa Diogo "Cooperation between Mozambique and India has been ever growing and it has been in areas that contribute to the relief of poverty, such as energy, mining, health, education, agriculture, and in the international arena, among others", said Diogo. India has granted Mozambique two credit lines, totalling about 40 million US dollars to be used in programs of electrification and water supply in the rural areas. In the area of education, Mozambique has sent 45 students to India for courses in various areas. Indian Minister of State for Foreign Affairs, Anand Sharma, who arrived in Maputo last Sunday for a two day working visit to the country, noted that his country cooperates with Mozambique in the area of infrastructure, where Indian companies are involved in major projects, such as the rehabilitation of the Sena railway line, that links the central port city of Beira, to the coal mines of Moatize, in Tete province. (aim) Attracting Investments is priority for Tete The Strategic Plan for the Development of the western Mozambican province of Tete stresses as one of its main priorities the attraction of investment. According to the Strategic Plan, for the period of 2007/2011, Tete should also pay special attention to job creation and establish close partnerships with the three countries that border the province, Malawi, Zambia, and Zimbabwe. The plan is also calling for strengthened efforts in the areas of education, prevention and the fight against endemic diseases, including HIV/AIDS, and for modernizing the public administration to improve the quality of services rendered to the public. Other priorities include stimulating production, particularly agro-industry, mining, tourism and fishing, through the use of the available natural resources, and the extension of the supporting economic infrastructures. (aim) Mozambique seeking Chinese investment in public transport sector Mozambique wants to attract Chinese capital to the country’s transport sector and would also like to host one of the special economic zones planned for Africa by Beijing, an official has said. “We have interest in creating joint-ventures with Chinese firms that wish to invest in public transport,” said Mozambique’s ambassador to China, Antonio Inacio Junior. In June, Transportes Publicos de Maputo (TPM) began operating four gas-powered buses in the Mozambican capital. The vehicles were built by Yutong in China. Ambassador Junior also suggested that more Mozambican firms should enter partnerships with Chinese companies in projects to build roads, water supply networks and health facilities. (macauhub) Mozambique's Banco Mercantil Adopts Equinox Software In a strategic move aimed at increasing its service efficiency, Banco Mercantil E De Investimentos SARL of Mozambique (BMI), a high profile merchant and investment bank in Mozambique has chosen to replace the Easy-Bank application with Neptune's Equinox Banking System. BMI plans to increase its customer base and service efficiency and effectiveness by a factor of about 500% in the next two years with a commensurate return on investment. According to Mr. José Morela, the banks managing director" The only way we can achieve this objective is by selecting a compatible vendor who commands distinctive record in software development and implementation and at the same time has the various solutions that can be leveraged to mobilize customers, improve services and achieve the target bottom-line." (allafrica) Chinese company builds steelworks for Arcelor Mittal in Mozambique MCC Huatian, a subsidiary of the China Metallurgical group, is to build a steel bar and rail factory for Arcelor Mittal in Mozambique with the capacity to make 400,000 tons, the Chinese company said, cited by Interfax. Mittal Steel South Africa in 2006 acquired the companies Companhia Siderúrgica de Moçambique (CSM) and Companhia Moçambicana de Trefilarias (Trefil), both of which were in receivership. Mittal Steel South Africa is part of the Arcelor-Mittal conglomerate, the world’s largest steel producer. (macauhub). R1.3 billion sugar expansions in Mozambique Expansions to Tongaat Hulett‘s Xinavane and Mafambisse sugar mills in Mozambique are progressing significantly, says Ton-gaat Hulett CEO Peter Staude. Capital totaling R1,3-billion was allocated to expanding both sugar and cane-growing activities at Mozambique mills earlier this year. The expansions will result in production increasing from 115 000 t to 270 000 t, in 2009, when the European markets open up to least-developed countries, of which Mozambique is one. (engineering news) Chinese company fined for abuses The Mozambican Labour Ministry has fined a Chinese owned company operating in the central province of Sofala 301,000 meticais (over 12,000 US dollars) for a series of gross violations of the country's labour legislation. When inspectors from the Sofala Provincial Labour Directorate went to check on this company, SOGEC-MUTUA, it found that it was paying its workers less than the statutory minimum wage, and was denying them their holiday rights. A recent statement from the Labour Ministry, however, said that the company is now paying the workers the money it owes them, for the entire period in which it was illegally paying less than the statutory minimum wage and is also working out how much it owes them in terms of holidays - which the workers have not enjoyed since 2002. (aim) Guebuza inaugurates fiber optic section Last Thursday, President Armando Guebuza said that information and communication technologies do not solve the problems imposed by poverty, since they cannot replace people, but they can speed up the achievement of the goals of the country's fight to overcome poverty. He was speaking in the central city of Quelimane at the inaugural ceremony for the latest section of the country's fiber-optic network, operated by the publicly-owned telecommunications company, TDM. This section links the port city of Beira to Quelimane. Work on the national fibre-optic network began in February 2006 and is due to be concluded by 2008. The German company Siemens is installing the cables, and the operation has cost TDM over 8.5 million US dollars. (aim) Maputo Governor Visits Industrial Park On July 05 2007, the Governor of Maputo, Telmina Pereira, accompanied by the Administrator of Boane, the Provincial Director of Public Works and Housing, and Assistant Director of Planning and Finance, paid an introduction visit to Beluluane Industrial Park (BIP). An initiative of the Mozambican Government and an Australian company, BIP was founded in 2000 to strengthen services to Mozal. It now occupies 630 hectares and has about 16 companies that range in size and industry. Overall, the visit was a very positive and constructive one. The main concerns expressed by BIP’s tenants were job creation for the local community and the access to electricity, water, security and transport. Everyone present agreed that working together to find a solution to the issues raised will lead to positive results, not only for BIP and the tenant companies, but the community as a whole. (mozlegal) MINING AND ENERGY Mozambique has one of largest deposits Kenmare’s Moma Titanium Minerals Mine in northern Mozambique, contains one of the largest deposits of titanium-bearing mineral sands in the world. The mining process is initially using one of two dredges to mine the mineral-bearing sands, with both to operate once the dredge pond is enlarged. The ore mined is being processed through the wet concentrator plant to produce a heavy mineral concentrate. This concentrate is currently being stockpiled for separation into final products (ilmenite, rutile and zircon). The total resource under license to Kenmare has increased by more than 60%, from 101million tons to 163-mil- lion tons of contained ilmenite, with associated increases in coproducts to 12,4-million tons of zircon and 3,6-million tons of rutile. The inferred resource at Nataka has increased from 49-million tons to 110-million tons of contained ilmenite, with associated increases in co-products to eight-million tons of zircon and two-million tons of rutile. (miningweekly) Moatize coal to create more than 1,000 jobs The Brazilian company Vale do Rio Doce (CVRD) is set to employ more than 1,000 Mozambicans over the next two years to prepare the take off of coal mining at Moatize, in the western province of Tete, reports the Maputo daily "Noticias"'. This guarantee came from Galib Chaim, director of the CVRD subsidiary Rio Doce Mocambique, last Tuesday at the ceremony at which the Mozambican government handed CVRD the mining concession title, valid for the next 35 years. Working in open cast mines, the company plans to extract about 11 million tons of coal a year. This will include 8.5 million tons of coking coal for export, mostly for use in the steel industry, while the remaining 2.5 million tons will be used to generate electricity. (aim) LEGAL NEWS BY MOZLEGAL “Making legislation accessible”: Tudo Legal launches in Inhambane In an effort to improve the business and legal environment in Mozambique, Mozlegal started the initiative, Tudo Legal, to increase access to and understanding of Mozambican legislation. Thanks to the support of the German government, GTZAPSP, the Tudo Legal project will be launched in Inhambane where users will have free online access to Mozambican legislation in English and Portuguese, model contracts and agreements, and an online Help Desk. The official launch will be on the 17th of July, 2007 in the Conference Room of the Escola Superior de Hotelaria e Turismo de Inhambane, Bairro Chalambe- Inhambane City. Sessions will be at 10:00H, 11:30H, 14:00H, 15:30H. Entrance is free but space is limited. To make your reservation, contact the Tudo Legal Coordinator, Haje Pedreiro, at [email protected] or Cell: +258 82 328 9600. TOURISM Mozambique to invest US$600 million ahead of South African soccer World Cup Mozambique plans to spend $600 million on new hotels, casinos and other leisure facilities as part of an effort to capitalize on a tourism boom expected when neighboring South Africa hosts the 2010 soccer World Cup. Cited by the Guardian newspaper, Albino Mahumana, director of tourism in Mozambique, said the country planned to attract a high number of soccer fans to the beaches and cities of Mozambique in 2010. It is expected that over 300,000 people will visit South Africa during the month-long championships, scheduled to begin on June 11, 2010. The capital of Mozambique, Maputo, is a few hours from Nelspruit, one of the nine cities that will host the games, six hours from Johannesburg. (macauhub) OVER THE BORDER Investments to Speed up Cooperation with Tanzania Mozambican President Armando Guebuza said in Dar es Salaam last Thursday that there is huge potential for further investments between Mozambique and Tanzania, which will speed up existing cooperation and strengthen ties of friendship between the two countries. Speaking to reporters at the end of a three day visit to Tanzania, Guebuza said that the bridge now under construction over the Rovuma river, that marks the border between Mozambique and Tanzania, and the transport corridor based on the Tanzanian port of Mtwara, will bring further development for the benefit of the people in both countries. (allafrica) THE INVESTOR by Adrian Frey The #1 Newsletter for top business, investment, and legal news in Mozambique July 03 2007 53rd Issue EDITOR’S NOTE More Mozambique business and investment news Dear Readers, Over the past year, the Investor has involved into a very successful newsletter thanks in part to your comments and suggestions. We are dedicated to providing our readers with free, short, to-the-point, informative articles on Mozambican business, investment, and aid. We have also recently launched a website at www.clubofmozambique.com, a news and information portal, where you can get a daily overview of Mozambican business, investment, and tourism headliners. At the website, you will also have free access to the Investor archive, along with in depth information on Club of Mozambique services, including Solutions|Solucções “the One-Stop business center” and Tudo Legal “Making Legislation Accessible”. For more information, please email [email protected]. Adrian Frey MOZAMBIQUE REVIEW Laura Bush announces $507 million Mozambique aid deal U.S. first lady Laura Bush announced last Wednesday $507 million in assistance would be approved for Mozambique to build roads and boost its battle with malaria, which kills about 150 Mozambicans each day. The MCC was established by U.S. President George W. Bush in 2004 to reward probusiness, democratic and progressive developing nations with aid and other assistance. Laura Bush, who is on a four-nation tour of Africa, said the U.S. assistance would be targeted at strengthening property rights, improving roads and agriculture, and installing water wells to help provide clean water. (reuters) GOVERNMENT Mozambique to Recruit Doctors from Other African Countries Mozambique aims to recruit 8,000 doctors from other African countries during the next 10 years in an effort to improve its health care infrastructure, which has been highly affected by the country's HIV/AIDS epidemic, Health Minister Ivo Garrido said. There are about 650 doctors serving the country's estimated 20 million people -- a figure that is about three times less doctors than what is recommended by international health experts. Mozambique has an adult HIV prevalence of about 16%, and many health care workers are living with the virus, according to Reuters. The country's HIV prevalence has hindered its ability to provide access to basic health care, including prenatal services. (pharma-lexikon) DONORS Power without Responsibility: The Mozambique Example By Elísio Macamo, University of Bayreuth The former President of Mozambique, Joaquim Chissano - a man admired for his diplomatic skills, composure and good manners - was angry. Speaking at a conference on aid at Oxford University he complained about how donors were using aid to pitch their tents up inside the government machineries of recipient countries. Chissano was particularly critical of direct budget support and poverty reduction strategies, as the amount of coordination required between donors and recipient countries and the level of expertise needed by the latter to meet the goals of either program effectively committed donors to taking a leading role. Read the full interesting article here. (oneworld) Mozambique seeks portion of Chinese investment funds Mozambique said last Friday it was set to benefit from a new investment fund announced in Beijing last week to support Chinese companies operating in Africa. On Tuesday, Beijing announced the creation of a US$1 billion fund to finance trade and investment by Chinese firms in Africa to reinforce China’s presence on the resourcesrich continent. The China-Africa Development Fund will be financed by the state Development Bank of China, which says it could increase the fund to US$5 billion. (afriquenligne) World Bank praises performance of Mozambique The Deputy Chairperson of the World Bank for Africa, Obiageli Ezekwesili, last Wednesday praised the efforts of the Mozambican government in the fight against poverty and the strengthening of the country's economy. Speaking to reporters after a meeting with Mozambican Prime Minister Luisa Diogo, she said that 15 years after the war of destabilization, that ended in 1992, Mozambique has managed to design macroeconomic policies and other reforms that stabilized the country's economy and improved its people's living conditions. Also, Ezkwesili stressed the need to use the country's natural resources, such as coal, gas, and timber, appropriately in the fight against poverty. (aim) Millennium Challenge Corporation approves funds The United States' Millennium Challenge Corporation (MCC) last week approved a program for Mozambique, valued at 506.9 million US dollars, over three years. The MCC board met in Washington on Wednesday and agreed on programs (known as "Compacts") for Mozambique, Lesotho and Guyana. An MCC press release declared that the Mozambican compact "aims to reduce poverty levels through increased incomes and employment by improving water, sanitation, roads, land tenure, and agriculture. This program is expected to benefit approximately five million Mozambicans by 2015". (aim) European Commission and Mozambique see eye to eye on agro research The European Commission and the government of Mozambique have entered into an agreement for the funding of agricultural research in the African state. Under the agreement, the EC is apportioning EUR 4.3 million for research on crops including cotton, potato, cassava and cashew. Glauco Clauzuola, the head of the EC delegation in Mozambique, and the Mozambican Minister of Agriculture, Erasmo Muhate, signed the pact on 2 June. (european research) ECONOMY India Now Among Top Ten Investors Mozambique's Minister of Energy, Salvador Namburete, said on Monday that the gradual growth of Indian investment has now put that country among the top ten investors in Mozambique. Speaking at the opening of a meeting in Maputo billed as the "Conclave on India/Africa Project Partnership 2007", Namburete said "Mozambique has become one of the major African destinations for investment from various parts of the planet". Namburete said the government hoped to see further Indian investment in such areas as agriculture, food processing, mining and energy. (allafrica) Cotton is exception to Mozambique’s general export boom Cotton is a product that has its origins in Mozambique’s colonial era and the industry is the exception to the current boom in the country’s main exports, officials have said. The Bank of Mozambique, in a report published last week on 2006, says the national cotton industry is facing stiff competition from internationally produced synthetic fibers. The increase of price in cotton was insufficient to compensate for the reduction in sales, with export value of the product being US$ 45.7 million, down 19 percent over the previous year, according to Mozambique’s central bank. The decline in exports is in contrast to the positive results of expanding cotton production in the 2005/2006 growing season, the best in the past 35 years with 123,000 tons, according to figures released recently from Mozambique’s Cotton Institute. (macauhub) Corporate Governance under discussion A recent conference on Corporate Governance, organized by the Governance and Development Support Institute (GDI), announced the creation of the Institute of Directors of Mozambique (IoDmz), as a body that will fight for professional and ethical behavior among Mozambican business leaders. The new Institute, which hopes to be registered by the Ministry of Justice in the near future, states, in its founding document, that it intends "to represent directors and senior managers in private and public sectors in lobbying for public policies that create an environment for innovation and development". At the conference, one of the IoDmz founders, Anderson Mondlane pointed to scandals in Mozambique's recent history, such as the near collapse of the two privatized banks, the BCM and Austral, in 2000 and 2001, which pointed to a deficit in corporate governance. (aim) Mozambican businesses opposed to scanning fees Mozambican private businesses have urged the Mozambican government to scrap, or at least reduce, the scanner fees charged in the port of Maputo, for fear that they could lead to increased prices for consumers, robbing Maputo port of its competitive edge. The scanner was installed about a year ago, and is used for "non-intrusive inspection" of merchandise. But management of the scanner was turned over to a private company, Kudumba, which appears to be using it simply to make money at the expense of the port users, all of whom are supposed to pay a scanner fee. Furthermore, where such fees exist in other ports they generally do not exceed 15 US dollars per container, said Kekobad Patel, the official of the Confederation of Mozambican Business Associations (CTA) in charge of tax and customs reform - yet Kudumba was charging 100 dollars per imported container. (aim) CTA Praises Interest Rate Cuts, Wants More The chairperson of the Mozambican Confederation of Business Associations (CTA), Salimo Abdula, has described as "very positive" the recent decision by the Bank of Mozambique to reduce its key interest rates. Three weeks ago the Board of Directors of the Bank of Mozambique announced significant cuts in the interest rates used for operations on the Interbank Money Market. It cut interest charged in the Permanent Lending Facility from 17.5 to 15.5 percent. The interest rate in the Standing Deposit Facility fell from 14 to 10.5 per cent. The CTA, however, wants further moves to make credit cheaper and Mozambican businesses more competitive. The CTA is now undertaking its own study of the Mozambican financial sector which it intends to deliver to the government, to back up its calls for cheaper credit. (aim) M-Cel Running at a Profit Mozambique's publicly owned cell phone company M-Cel is now running at a healthy profit while its sole competitor, the South African owned Vodacom, is still making heavy losses. According to a press release issued by M-Cel, the company made a profit of 491 million meticais (about 19.6 million US dollars) in 2006. Total revenue in 2006 was 4.4 billion meticais (about 170 million dollars), which was an increase of 29 per cent over the 2005 figure, M-Cel boasts that it holds 70 per cent of the Mozambican cell phone market with a total of 1.48 million clients in December. Vodacom's latest financial statement, issued in March, admitted to a loss of 177 million rands (about 25 million dollars) on its Mozambican operations. (allafrica) Mcel vandalizes historic sites in the war of cell phone providers Mcel has publicly apologized for defacing the walls of monuments and other public and private structures on the historic island Ilha de Moçambique. This island, located off the coast of Nampula, was the first capital of the colonial Portuguese East Africa. Its exceptional mixture of architecture captures the island’s Arab, Indian, Portuguese, and African influences. It is this unique blend of cultures that led the United Nations Education, Scientific and Cultural Organization (UNESCO) to declare it a World Heritage Site. Although Mcel has apologized for the disrespectful advertising, no mention has been made of whether or not they will be forced to remove the garish ads. Click here for photos of the advertisements. (ramon ynajara, photos) The 2nd Native American-Southern African Cultural Exchange Visit From June 26 to July 8, 2007, the W.K. Kellogg Foundation is hosting an exchange visit of 47 Native American artists and artisans to southern Africa. This is a return visit following a similar visit undertaken by southern African artists and artisans to Santa Fe, New Mexico, in August 2005. The principal aim of the visit is to exchange knowledge, skills and experiences with a view to strengthening linkages, and working towards increasing indigenous people’s share in the world’s economy. From Monday, July 2, to Thursday, July 6, 2007 the delegation will conduct site visits in Botswana, Lesotho, Mozambique, South Africa, Swaziland and Zimbabwe. The Mozambique site visit will be hosted by the CEDARTE and ATA under the theme, Methods, Marketing and Community-based Entrepreneurship. Click here for more info. (Evaristo Madime) MINING AND ENERGY Companhia Vale Do Rio Doce Says Mozambique Has Approved Mining Contract Companhia Vale do Rio Doce (RIO) said that the government of Mozambique has approved the mining contract for the exploitation of the Moatize coal project, located in the northwestern province of Tete, following the approval of the project development plan by the Mozambican authorities earlier this month. The duration of the contract is 25 years and can be extended for additional periods of time. Further, the contract establishes tax, international trade and foreign exchange regimes that will govern the company's investment in Moatize. According to the company, the project involves the exploitation of an open pit mine for 35 years, with an estimated average annual production of 11 million metric tons of coal products. Out of the total coal production, 8.5 tons would be metallurgical coal and 2.5 would be thermal coal. (rttnews) Mozambique’s EDM power utility loses over US$ 6 million due to theft Theft of cables and other equipment has cost Mozambican state power company EDM more than US$ 6.5 million since 2001, the company’s CEO has said. Cited by the Noticias newspaper, Manuel Cuambe said US$ 650,000 worth of material has been stolen in the first half of 2007, with most of these loses caused by theft of oil from power transformers. Each of EDM’s transformers costs the equivalent of around US$ 16,000, noted Cuambe, and this equipment has to be imported, “which takes time,” meaning power cuts in some areas are likely for long periods. (macauhub) Mozambique plans new tender for oil Mozambique plans to launch an oil exploration tender in the southern province of Inhambane by the end of this year. Mineral resources minister Esperanca Bias said last week: "When we are ready we will eventually launch a bid. We are expecting results from block 16 and 19 in Inhambane and we also have another company drilling in the Zambezi offshore." Located south of Inhambane, the Pande gas field is a proven world-class natural gas deposit, with reserves of more than 3.5 trillion cubic feet. Bias said considerable oil and gas exploration possibilities existed in the provinces of Gaza, Inhambane, Sofala, Zambezi, Nampula, Cabo Delgado, and related offshore areas. For more information contact [email protected]. Mining Investment in Mozambique soars by 56% According to Mozambique’s High Commissioner, Antonio Gu, foreign mining investment in Mozambique soared to $250 million in 2006. Investment climbed from $40 million in 2004 to $160 million in 2005. About 900 valid mining licenses were issued last year, with 25% covering base metals projects, 25% tantalite, 10% in coal and 8% in gold. Majors like BHP, Rio Tinto and CVRD Inco are all active in the country, but UraMin is also exploring for uranium in Mozambique. In mid-June, Areva made an all-cash bid of $2.5 billion, about $7.75 a share for UraMin. (resource investor) Pan African completes detailed mapping at Mozambique prospect Exploratory resource company Pan African Mining last Thursday reported the completion of detailed mapping of the old Machinga gold mine, located near Cazula in Tete Province, Mozambique. The Cazula project comprises five prospecting licenses, covering some 175 m2 km. The work was undertaken on behalf of the joint venture between Pan African Mining and Manica Minerals. Pan African Mining was planning to undertake a reconnaissance core drilling program, initially consisting of about 1000 m, to evaluate the tenor and extent of gold-bearing mineralization around and below the old mine galleries. (mining weekly) LEGAL NEWS BY MOZLEGAL Land titles cancelled in Maputo province The Maputo Provincial Directorate of Agriculture is making good on a longstanding threat to cancel land tenure rights of investors who fail to use land allocated to them. Inspectors visited 287 land concessions in five districts - and found that 95 of them had been abandoned. The Land Law states that investors applying for land must present a plan for what they intend to do with it. Mozambican investors have five years, and foreign investors two years, to put that plan into operation. During that period their land rights are only provisional. If, after the end of this period, there is no sign that the land is being put to productive use, in line with the investor's original plan, then it should revert to the state. For more information on this, contact [email protected]. (aim) New National Minimum Wage in effect The Ministries of Finance and Labor have set the minimum wage for all of Mozambique under the Ministerial Diploma 54/2007 of June 11. After much debate between trade unions, business owners, and government, a decision was made to readjust the current national minimum wage levels in force in Mozambique for the sectors of industry, commerce, services and agriculture. Using the prerogative established in article 47(4) of Law 8/98 of 20 July, and having consulted the social partners within the framework of the Labour Consultative Commission, the Ministers of Finance and Labour determine that the following minimum wages will apply, backdated to 1 April 2007: 1 645.50 MT for employees in industry, commerce and other services; 1 126.50 MT for employees in agriculture and livestock. For more information, or a copy of the diploma in English or Portuguese, contact [email protected]. TOURISM Nkwichi Lodge gets an upgrade NKWICHI Lodge, located in northern Mozambique, is upgrading its facilities and expanding its accommodation offering. The lodge is building two secluded houses, Makolo and Songea, to offer privacy to guests. Both are expected to be completed by next year. The Makolo House will comprise two en-suite bedrooms and an upstairs platform. The house will also have private access to Lake Niassa and its own chef. The Songea House will offer outside dining facilities, a secluded private beach and a circular reception room with a sunken sitting area. It will also have an upstairs bedroom with a balcony overlooking the central room downstairs. A separate chalet will be situated near to the main house. (travelinfo) Tourism investment in Mozambique reached US$ 604 million in 2006 Investments in Mozambique’s tourism industry increased by US$ 83 million from 2005 to reach US$ 604 million last year, an official said. Deputy-Tourism Minister Rosario Mualeia, cited by the Noticias newspaper, said most of the investment had been in building hotels, roads and in new tourist resorts. Mualeia said the Maputo’s tourism ministry’s coordination council meets 3-5 July in the Gorongosa National Park in Sofala province to evaluate developments in the sector over the last 12 months. (macauhub) OVER THE BORDER SA-Mozambique border open till midnight The opening hours at the border of Ressano Garcia have been extended from 10pm to midnight. The move was put in place to facilitate the easier movement of people and traffic. The staff at the border post would be beefed up to meet the demand of the new working hours. There have been recent talks of having the border operate around the clock. (Sapa) Maputo Corridor will have simultaneous border clearance by 2009 The Maputo Corridor will have a one-stop border post between Mozambique and South Africa handling 9m tons along it annually by 2009. CEO of the Maputo Corridor Logistics Initiative (MCLI), Brenda Horne, last week told delegates to the RailAfrica2007 Conference and Exhibition in Johannesburg that the R600 000 border post will be multi-functional. It will be able to handle passengers and road and rail cargo clearing in separate streams simultaneously. (CorridorNet) Mozambique and Zimbabwe plan to cut need for entry visas Mozambique and Zimbabwe are to abolish entry visas for the citizens of both countries by the end of the year, the Mozambican high commissioner, Vicente Veloso said in Harare last Monday. Veloso called on businesspeople from both countries to make the most of advantages brought up by the abolition of visas, as this measure would make it easier for movement of people and goods between the two countries. Mozambique has already signed visa exemption agreements with countries in the region, including South Africa and Swaziland. (macauhub) Zambia to have access to Mozambican port of Nacala as of September Zambia will be linked next September to the Mozambican port of Nacala, in Nampula province, according to Edwin h. Hatembo, the Zambian ambassador to Mozambique, according to Wednesday’s edition of Mozambican newspaper Notícias. “By September the work will be concluded and from then on we can say that the Nacala corridor will be one of the doorways for our foreign trade," the diplomat said in Nampula a few days ago. The paper said that reconstruction work was underway on the railway line between Nchingi and Chipaka, in Malawi, in order to establish the link to Mozambique via the Nacala corridor. (macauhub)