Mozambique

Mozambique is AFD Group's first country of operation in southern Africa. This historic presence was made possible thanks to a wide range of financial tools mobilized over the years. Today, AFD is supporting the country in its low-carbon trajectory and in the development of basic services.

Context

Bordered by the Indian Ocean in southern Africa, Mozambique is a vast country with over 28 million inhabitants.

The country has many assets: hydro-electric power, off shore oil, mining, agriculture and tourism. Indeed, Mozambique has an exceptionally rich natural heritage and several protected nature reserves. Moreover, the recent discovery of significant coal and gas deposits could radically change Mozambique's economic position and structure.

However, the country’s economic growth has not led to a genuine reduction in poverty. Mozambique still faces significant challenges: improving the distribution of wealth, making basic services (water and electricity) accessible to the whole population and upgrading its infrastructures.

AFD has been present since 1981 and is supporting the country's sustainable development through loans to the public (State or public companies) and private sectors (banks, companies, micro-finance institutions), financial guarantees, subsidies (NGOs, studies, capacity building), technical support missions and training.

AFD's Mozambique office is directly attached to the Southern Africa regional office in Johannesburg.

Our approach

"AFD and Mozambique: reducing poverty and protecting the environment"

Our Just Energy Transition portfolio (implemented in partnership with the Ministry of Energy, EDM- Electricidade de Mocambique, the regulator ARENE and HCB- Hidroeléctrica de Cahora Bassa ) focuses on the development of renewable energies:

rollout of the PROLER pilot programme (€30 million in European funding), supporting the implementation of tenders for the development, construction and operation of four solar and wind power plants (160MW on-grid) in partnership with the private sector;
rehabilitation of the Cahora Bassa dam operated by HCB (€98 million, including €23 million in European funding).

We also support the modernization of the electricity grid and the strengthening of its operator, EDM:

reduction of non-technical losses on EDM's southern network, in partnership with the European Union (€12 million)
modernization of EDM's vocational training center (€6 million).

AFD is also committed to improving public access to drinking water and sanitation services. The partnership with FIPAG will soon connect 830 000 people to Maputo's water network. We also support the public company AIAS to rehabilitate the Beira wastewater treatment plant and part of the city’s sanitation network.

Finally, AFD promotes sustainable and inclusive transport through the rehabilitation project of the Ressano Garcia–Maputo railway line, in partnership with CFM (Caminhos de Ferro de Moçambique).

With an area of 800,000 km², Mozambique is home to a wide diversity of ecosystems, more than a quarter of which are legally protected. Today, the loss of natural habitats, overexploitation of animal and plant species, pollution, and climate change are the main threats to the country’s rich biodiversity.

For over twenty years, AFD and FFEM (French Global Environment Facility), alongside various sector operators, have supported projects that combine biodiversity conservation with local development initiatives benefiting rural populations, where poverty is particularly acute. In total, eight projects are currently underway in the protected areas of Limpopo, Niassa, Chimanimani, Gilé, and Marromeu. More recently, AFD has also been involved in disaster risk reduction by promoting Nature-based solutions in the Zambezi Delta.

In addition, through the ACAMOZ project, in partnership with the NGO Nitidae and the Mozambican Almond Institute, AFD supports the development of the cashew and macadamia value chains.

Since 2020, AFD has been part of the multi-donor common fund Fase supporting the implementation of the Mozambican government’s ten-year sector plan for basic education. The project to design a strategy for secondary school teacher is fully complementary to this approach.

AFD financed the Beira General Hospital, in Sofala Province, as well as the NGO Muva to promote the economic empowerment of women in disadvantaged urban areas. Lastly, AFD collaborates with the Mozambican foundation Futebol da Força, which promotes sexual and reproductive health and rights among young women through football.

AFD is engaged in Cabo Delgado Province through two projects:

strengthening food security and supporting the agroecological transition in Montepuez (with the Aga Khan Foundation);
protection, learning, and awareness against gender-based violence (PAZ) (with the Aga Khan Foundation).