Maputo, 11 Jun (AIM) – The Portuguese government, through its Cooperation Business Fund (FECOP), has pledged to disburse 17 million Euros (19.6 million US dollars the current exchange rate) to support Mozambique’s micro Small and Medium-sized Enterprises (SMEs).
According to Helena Guerreiro, head of Cooperation at the Portuguese Embassy in Maputo, speaking on Wednesday, on the last day marking the second edition of Mozambique–European Union Business Forum (Global Gateway), this fund is exclusively aimed at supporting the country’s SMEs.
“It also will support producers’ associations and cooperatives. This is an important instrument of cooperation between Portugal and Mozambique, designed to address some of the country’s main challenges, and now includes new facilities to facilitate disbursement”, she said.
According to Guerreiro, FECOP funds investment projects and can guarantee up to 90 percent of credit, with a maximum limit of approximately 25.5 million meticais, requiring a minimum equity contribution of 20 percent.
“It covers companies located in areas affected by natural disasters, allowing financing for both investment and working capital, with guarantees of up to 85 percent and a ceiling of approximately 6.5 million meticais”, she explained.
The body also funds microfinance institutions to strengthen their credit portfolios, providing guarantees of up to 90 percent and a financing limit of approximately five million meticais, enabling funding to reach more businesses indirectly through these intermediary institutions.
The fund includes a grant facility aimed at micro and small enterprises, particularly those linked to young people and priority initiatives, offering direct support of up to approximately 450,000 meticais to promote competitiveness and business development.
“With grants, application procedures have been greatly simplified so that participation can reach the levels we hope for. The instruments provide subsidized interest rates based on the Prime Lending Rate, with significant reductions designed to make credit more accessible to Mozambican businesses”, Guerreiro said.
This fund is part of legal cooperation instruments signed by the governments of Mozambique and Portugal last December, during the sixth bilateral summit between the two countries.
Am/
