First international conference on local content organized in Maputo

Organized by the Confederation of Economic Associations of Mozambique (CTA) with the support of the Fund for Business Environment (FAN), the conference in Maputo on Sept. 17 brought together private sector associations, Mozambican and foreign companies, as well as representatives of the Ministry of Economy and Finance and other public agencies, such as the Centre for Investment Promotion – CPI.
The conference aimed at harmonizing national understanding on local content (including on how to apply political instruments linked to it) and discussing how Mozambique’s trade policy could support the development of small and medium-sized enterprises (SMEs).
CTA Vice President Agostinho Vuma pointed out the increasingly substantial business opportunities that the Mozambican economic growth generates for Mozambican SMEs, especially in the fields of tourism, agriculture and fishing. The potential of attractiveness for foreign companies, particularly in the natural gas sector, can also help to strengthen local resources and dynamics. In this context, the CTA takes a significant interest in the definition of local content and is eager to continue working on it with the public and private sectors in a “win-win” strategy that will foster a more inclusive economic growth.
The conference was divided into four debates on the different existing theories about and approaches to local content, as well as procurement practices, logistics dispositions and commercial opportunities related to it. The case of Mozambique was enlightened by the experience of other countries such as Uganda, Kenya, Tanzania and Brazil. Marco Ferreira, representing Accenture Brazil, presented the first Brazilian program (2005) of local content launched in the oil and gas sector (PROMIMP, in collaboration with Petrobras) and highlighted its key success factors.
Deputy Economy and Finance Minister Amelia Nakare insisted that local content policies should benefit micro, small and medium-sized enterprises, which represent a significant part of the Mozambican economic structure and account for about 21.5 percent of economic growth. SMEs should be involved in the transformation process of the national economic structures that has become crucial in recent last years. Local content can be a catalyst for job creation, especially in the fields of tourism, agriculture, mineral resources and raw material transformation.
Enilde Sarmento from the Ministry of Economy and Finance argued that local content in Mozambique should focus on the mineral resources, hydrocarbons, oil and construction sectors, whereas specific laws should regulate other economic sectors. She reminded the audience that the creation of a legal instrument on local content in Mozambique could intensify the demand directed towards the domestic market, increase employment rates and facilitate the diversification of the industrial sector.
However, she also pointed out the risks of preventing these sectors from becoming more competitive with foreign suppliers, of reducing investment in R&D and innovation policies and of discouraging new investments by foreign investors.