Maputo, 22 Sep (AIM) – Mozambican President Filipe Nyusi on Thursday called for careful and transparent management of the funds granted to Mozambique by the United States Millennium Challenge Corporation (MCC).
He was speaking in Washington after witnessing the signing of an aid package (known as a “compact”) between his government and the MCC. Signing the document were the Minister of Economy and Finance, Max Tonela, and the executive chairperson of the MCC, Alice Albright.
The compact is valued at 537.5 million dollars. 500 million dollars is a grant from the US government, and the remaining 37.5 million dollars is Mozambique’s own participation.
The compact concentrates its effort on just one province, Zambezia, in the central part of the country. It covers three main areas – the promotion of investment in commercial agriculture; connectivity and rural transport; and climate change and coastal development.
It envisages the construction of a new bridge over the Licungo river, in Mocuba district, and a ring road, that will provide an alternative to the current bridge that carries the country’s main north-south highway (EN1) across the river. This is intended to provide greater safety and mobility for road users.
A further 200 kilometres of national, regional and rural roads will be built in Zambezia, to ensure better distribution of agricultural produce. According to the MCC, the compact is also intended to protect the Mozambican coastline from the effects of climate change and over-fishing.
Cited in Friday’s issue of the independent newssheet “Mediafax”, Nyusi said “our understanding is that the areas defined as priorities for this programme are fundamental for attaining the desired economic growth and for reducing poverty”.
To reach these goals, efficiency and effectiveness from a cost-benefit perspective are required, he stressed.
The components of the compact, Nyusi said, must be implemented with rigour, good governance, transparency, accountability and independent audits.
The company, he added, resulted from “the growing trust” between the US and Mozambique, “and we must never betray this trust that we have deserved”.
Tonela declared that the compact will speed up the country’s development, create jobs and boost productivity. Although the compact is focused on Zambezia, he was convinced that it will have an enormous impact on the entire country.
Alice Albright said the new compact will bring MCC’s total investment in Mozambique to over one billion dollars – this is because it is the second MCC compact. Over a decade and a half ago, the first five year compact was signed, for about 507 million dollars.
“In 2008, we partnered to rehabilitate roads, build water and sanitation systems, improve crop yields and secure land tenure”, recalled Albright. “This compact will build on these prior successes and invest in some of Mozambique’s biggest priorities, unlocking the country’s vast economic potential and helping Mozambicans gain access to opportunities they deserve”.
The new Connectivity and Coastal Resilience Compact, to give the programme its full name, is expected to improve the lives of Mozambicans through sustainable and inclusive economic growth, MCC claims.
The funds will be managed by the Millennium Challenge Account (MCA) Mozambique office, comprised of Mozambique government, civil society, and private sector representatives.
Reacting to the agreement, the Mozambican Confederation of Economic Associations (CTA) says that “the programme is an unparalleled opportunity to leverage the national private sector at a time when it is still recovering from the effects of the successive shocks that have hit our country in recent years.”
According to CTA, the realisation of Compact II could also help small and medium-sized enterprises (SMEs) in particular to expand their market and thus improve their financial strength.
The compact has been divided into three projects: the Connectivity and Rural Transport Project (CTR), the Promoting Reform and Investment in Agriculture Project (PRIA), the Coastal Livelihoods and Climate Resilience Project (CLCR).
(AIM)
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