Maputo, 5 May (AIM) – The Mozambican parliament, the Assembly of the Republic, on Thursday passed the first reading of a government bill on the cashew industry, reversing policies imposed by the World Bank which, in the late 1990s, came close to destroying the industry.
At that time, the Bank, as one of its conditions for loans, insisted that the government end all forms of protection for the industry, and concentrate instead on exporting raw, unprocessed nuts (mainly to India).
Before the World Bank’s interference, Mozambique was processing around 50,000 tonnes of cashew nuts a year. After the Bank’s diktat, the figure fell to 8,000 tonnes. All the large processing factories closed, and thousands of cashew workers lost their jobs.
World Bank bureaucrats of the time had no problem lying about the Mozambican cashew industry, claiming that it was unsustainable. They wanted all the nuts to be exported raw, without any taxes on these exports.
Opposing the destruction of the industry were investigative journalists, notably the late Carlos Cardoso, the cashew workers’ trade union, and the Association of Cashew Industries (AICAJU). In 1999, a law was passed restoring some protection to the industry, but the damage had already been done.
The new bill replaces the 1999 law. Introducing the bill, Agriculture Minister Celso Correia declared that the World Bank policies had led to cashew sector into “decadence”.
The new law increases the surtax on exported raw nuts, from 18 to 22 per cent, in the hope that most of the nuts will be processed inside Mozambique. Furthermore, the ban on the industries themselves exporting raw nuts has been overturned. This was a peculiarly senseless policy, which was supposed to defend the interests of the peasant farmers who grew the cashews.
The World Bank claimed that removing protection from the industry would favour the farmers – but not a shred of evidence was ever presented for this claim.
Correia said that, when the industries had fulfilled their own requirements, they should be free to export any surplus unprocessed nuts. This would give the industries another source of revenue, and help capitalise their businesses.
The new bill consolidates a trend for the revival of the cashew industry which has been visible for more than a decade and a half. Cashews now make a substantial contribution to the Mozambican economy.
According to Correia, in the 2021/2022 agricultural campaign, cashew growers received gross income of 5.7 billion meticais (about 90 million dollars, at the current exchange rate). Revenue from the export of processed cashew kernel plus unprocessed nuts was 107 million dollars.
The government bill was passed unanimously. Defending the cashew industry is one of the few areas where the ruling Frelimo Party and the opposition are in agreement.
(AIM)
Pf/ (482)
