The implementation of this new agreement, which is under the responsibility of IFC, the soft loans arm of the World Bank, seeks to help local SMEs to deliver contracts to large businesses operating in Mozambique, and with a life span running from eight to 20 years in the mining industry, natural gas among others.
IFC director to Mozambique and Angola, Tunde Unitiri, and MOZAL, Cervejas de Mocambique (CDM), Coca Cola and SASOL representatives namely, Frans Jaspers, Saider Sibanda and Dino Cangy, signed the new agreement.
Speaking during the ceremony, Unitiri, explained that the program was established in Mozambique four years ago and today it includes over 20 SMEs, and it is hoped that the number could exceed 100 with the expansion of this initiative, and with new investments reaching over 20 million USD in the next three years.
"Each individual company will have to look at products and services it requires and the program will help to identify Mozambican companies capable of supplying those goods and services", said Unitiri.
SMEs are yet to take advantage of the new mega projects that are being established in Mozambique, as these tend to cater for their needs abroad, particularly in the South African market, in terms of goods and services.
Consequently, the trickle-down effect that economists often say result from inward investment remains elusive and there is little evidence that Mozambique's SMEs are benefiting from the large sums invested in the big companies.
This is blamed on the SMEs failure to participate in the complex process of bidding for contracts, non-compliance with the quality standards and delivery dates, poor management and lack of working capital to make for materials purchase and payment.
Therefore, said Unitiri, this program will help the Mozambican companies to achieve the quality standards demanded by providing training and technical assistance to achieve that desired quality standards.
For his part, Frans Jaspers said that MOZAL is already working with 250 SMEs buying nearly 16 million USD worth of goods and services a month from local suppliers and working with them to improve and maintain quality and safety standards.
Built in the outskirts of the capital Maputo in the late 90's MOZAL is one of the largest sources of Mozambique's export revenue.
The sectors of transportation, electrical and mechanical maintenance, meal services, gardening, among others, are some of the services outsourced by MOZAL.
This program falls under the MOZLINK initiative, a collaboration between the largest companies operating in Mozambique that includes MOZAL, Cervejas de Mocambique, Coca Cola and the publicly owned company Electricidade de Mocambique (EDM) having as its main partners the Centre for Promotion of Investment (CPI) and IFC.
Since its inception in 1956, IFC has disbursed just over 56 billion USD for investment in the private sector in developing countries.
Also, with donors support, IFC has spent over one billion USD in technical assistance and consultancy services.
SOURCE: AIM
