Newsletter CTA 267

Canada-Mozambique Business Forum took place in Maputo On Feb. 18, Maputo hosted the Canada-Mozambique Business Forum, which aimed to provide participants with a high-level platform to network with key decision-makers in Mozambique and develop new trade and investment opportunities. Around 100 people participated in this event, which brought together major players such as Carlos Mesquita, the Mozambican minister of transport and communication; Chivambo Mamadhussen, the CTA’s vice president of the commission responsible for mineral resources; Lourenço Sambo, the director general of the Centro de Promoção de Investimentos (CPI); Omar Mitha, the CEO of the Empresa Nacional de Hidrocarbonetos (ENH); Fausio Mussa, the chief economist of Standard Bank in Mozambique; John Peffer, the president of Anadarko in Mozambique and Shawn Barber, the High Commissioner of Canada to Mozambique, Malawi and Swaziland. Mesquita stressed that the development corridors (Beira, Nacala and Maputo) serve the national and international economies and recalled that cabotage is a priority this year. He presented a list of some of the works that will start this year including the rehabilitation of the Cuamba-Lichinga railway line, the beginning of the modernization of the port of Nacala and the drainage of Maputo’s harbour channel. Mesquita called on Canadian companies to invest in the agriculture, energy, infrastructure and tourism sectors. In his turn, Mamadhussen stated that as part of the development of the business environment for the mining industry, particularly for opportunities related to the Liquefied Natural Gas (LNG) construction project in the Rovuma Basin, the vision of the CTA focuses on promoting local content "as a weapon for strengthening the domestic private sector."

SUMMARY

BUSINESS ENVIRONMENT- Canada-Mozambique Business Forum

took place in Maputo.

- B u s i n e s s I n t e g r i t y C o u n t r y Assessments report presented last week in Maputo.

- Government to create National Fund for Financing of Technical Vocational Training.

- National minimum wage could be

adjusted in April.

EVENTS- Seminar on Economic Partnership

Agreement with the European Union held in Maputo.

- Presentation of the Business Integrity Pact Against Corruption in Maputo.

OPPORTUNITY- Expression of Interest: audit firm for

the Education Sector Support Fund

(FASE).

ECONOMIC INDICATORS - Exchange rates and inflation rates. - Tax calendar.

Newsletter n°267 - 24.02.2016

Editora: AVRIL Consulting

Sede: Av. Patrice Lumumba, 927 - Bairro Central - Maputo Ι www.cta.org.mz

Email: [email protected] I Tel: + 258 21 32 10 02 I Fax: + 258 21 32 10 01

Por um Melhor Ambiente de Negócios!

Chivambo Mamadhussen

http://www.cta.org.mz

mailto:[email protected]

Business Integrity Country Assessments report presented last week in Maputo

2 - Newsletter 267 Confederação das Associações Económicas


He encouraged Canadian companies to work with the domestic private sector in areas such as training and the transfer of know-how, joint ventures with domestic private companies and local supply. He recalled the legal framework of local content in Mozambique (including articles of the Mining Law and the Petroleum Law and the Social Responsibility Policy) and stressed a key point of the Decree Law dedicated to the LNG programme in the Rovuma Basin: Article 10. This article encourages international companies who want to contract goods and services to prefer "domestic companies

held by Mozambicans or foreign companies in partnership with Mozambicans, always ensuring competitive price, quality standards and delivery time as stipulated". He added: "All this should be reflected in a local content plan that must be approved by the government for each project". With about 27 percent of its GDP coming from the mining, oil and gas sectors, Canada has strong technical know-how and capabilities in the area of training. With this forum, the country demonstrated its willingness to invest in Mozambique in the field of extractive industries.

The Center for Public Integrity (CIP) presented the report of the Business Integrity Country Assessments (BICA) on Feb. 18 in Maputo. Created by Transparency International (TI), BICA seeks to contribute to evidence-based reforms in the area of corporate integrity by regulators, companies, industry sectors and industry associations alike. Mozambique was chosen as one of the pilot countries for this global initiative. BICA examines the interface between corruption and business. Through this, it assesses the environment in which businesses operate, the behavior of groups of businesses and industry sectors and the behavior and individual companies -- local and multinational -- including their public disclosure on anti-corruption policies. Speakers at the event included Adriano Nuvunga, the director of the CIP; José Macuane from the CIP; Amélia Nakhare, the president of the Autoridade Tributaria de Moçambique – AT (Tax Authority); Peter Eigen, the founder of TI and Fernando Silva, the director of energy management for Siemens in Mozambique.

According to the report, although Mozambique has strong legislation, the absence of strong instruments for its implementation and the lack of resources in institutions contribute to the inefficiency of the fight against corruption. "There are few incentives for companies to promote business integrity", according to the document, which suggests an improvement in the organizational capacity of the entities responsible for compliance with rules on public transparency and integrity, including the Procuradoria-Geral da República - PGR (Attorney General's Office) and the Judicial Court. The study also indicates that the AT of Mozambique does not have the ability to audit and inspect companies while at the same time playing its fiscal role. Speaking at the presentation ceremony of the report, the president of the AT, Amelia Nakhare, admitted that the fiscal integrity in Mozambique is still a big challenge, adding that the AT can only raise an insignificant part of the national revenue. “Today, fortunately, we can say that the CTA calls for more tax than the AT itself", she said.

Shawn Barber and Carlos Mesquita

Seminar on Economic Partnership Agreement with the European Union held in Maputo


In an interview, the CTA’s vice president, Rui Monteiro, stressed the importance of such reports to increase the country's productivity and development. "While BICA is still too general, it already allows the identification of the key areas in which we must work." He added: "The big challenge is the management quality in companies". He recalled that for the last two years, the CTA has worked each month with the AT for more transparency in public tenders and that they have a commitment to increase the tax basis. The CTA has played a significant role in mobilizing companies to participate to this report.


P. Eigen, F. Silva and A. Nuvunga

Rui Monteiro

In partnership with the Ministry of Industry and Trade and the Tax Authority, on Feb. 23, the European Union (EU) organized a seminar on the Economic Partnership Agreement (EPA), with speakers from the European Commission, the Ministry of Industry and Trade and the Tax Authority. The event was opened by the Ambassador of the European Union in Mozambique, Sven Kuehn von Burgsdorff. The objectives of the event were to understand the scope of the agreement, the practical consequences as well as the opportunities for the private sector since the signing of the agreement is expected in June 2016. Relations between Mozambique and the EU, the second-largest trading partner of the country, were governed by the interim EPA signed in June 2009, which offered duty-free, quota-free access to the EU market, considering the reduction of tariffs on the Mozambican side. Trade relations between the EU and Mozambique emerged strengthened with the completion of the negotiations of the EPA in July 2014 together with Botswana, Lesotho, Namibia, South Africa and Swaziland.

The agreement still needs to be ratified to be applicable. Until the agreement is ratified, Mozambique will have access to the European market through the specific rules of the "Everything but Arms" system. The market access regulation procedures of the EPA can not be applied anymore. The European Union is the largest trading partner of the Southern African Development Community (SADC) EPA. In 2013, EU imports amounted to €31 billion (9.3 percent agriculture, 1.5 percent fishing and 89.3 percent industry). In 2013, EU exports to the region account for €33 billion. This seminar took place the day before a visit to Mozambique the EU High Representative for Foreign Affairs and Security Policy and Vice President of the European Commission, Federica Mogherini. She is to meet with Mozambican President Filipe Nyusi and the Minister of Foreign Affairs and Cooperation, Oldemiro Baloi. Mogherini will have the opportunity to discuss the strong economic, politic and development partnership the European Union has with Mozambique.

Government to create National Fund for Financing of Technical Vocational Training

Presentation of the Business Integrity Pact Against Corruption in Maputo



In the context of the review of the law on vocational education passed by the Mozambican parliament on Feb. 18, the Minister of Science, Technology, Higher Education and Technical Professional Training, Jorge Nhambiu, has assured that the government will create a National Fund for the Financing of Technical Vocational Training. "The review of the law aims to amend the scope of professional education and create the basis for the functioning of the National Vocational Education Authority. We will also create the Statute of the Professional Education Trainer, with the aim of increasing the quality of this educational category », has declared the minister. He also revealed that some development partners are already responding to the request of the government to contribute money to the reform of technical vocational training and stated

that the government needs $400 millions to reform the technical vocational education, focusing on the construction and equipment of 28 schools. Nhambiu spoke on the sidelines of the first national planning meeting of the Ministry of Science, Technology, Higher Education and Technical Professional Training (MCTESTP) held under the theme "Science and Technology, Higher Education and Technical Vocational Training" with the participation of MCTESTP’s national directors and assistants, among other institutions supervised by the ministry. The government has identified vocational education as a strategic and critical component in the fight against poverty and for the promotion of social and economic sustainable development.

The Institute of Directors of Mozambique (IoDMZ) organized a workshop on Feb. 24 in Maputo for the presentation and discussion of the Business Integrity Pact Against Corruption. The IoDMZ is a non-profit institution whose main objective is to promote corporate governance in Mozambique. Aware of its responsibility as a representative of administrators, directors, managers and other executives, the IoDMZ decided to mobilize the private sector and other stakeholders to develop and implement a tool-designated Business Integrity Pact Against Corruption. The Pact is the IoDmz's contribution to the promotion of transparency and integrity in business in Mozambique, strengthening the power of the government and the judiciary to improve the business environment and encourage a strong and fair business environment. In addition to the businessmen, the workshop was attended by João Martins, the vice president of IoDMz; David Jorge,

director of the IoDMz, Luís Sitoe, the executive director of the CTA; Bernardo Duce, the representative of the Anti-Corruption Central Office (GCCC) and Albertina Fruquia, the director of Unit Procurement Oversight Functional (UFSA). LuÍs Sitoe recalled that a code of conduct for members and leaders of the CTA was approved last year and called for greater integrity and transparency in business management in Mozambique and an awareness campaign on the need to pay taxes to prevent tax evasion. In turn, Bernardo Duce recalled that the new penal code, which came into force last year, criminalises corruption in the private sector. It provided an opportunity to share experiences and knowledge on effective measures to promote integrity and transparency, as well as on the advantages that the integrity pact gives to entrepreneurs and the public sector in public procurement procedures and the development of ethical business.

João Martins, Bernardo Duce, David Jorge and Luís Sitoe

National minimum wage could be adjusted in April

Expression of Interest: audit firm for the Education Sector Support Fund (FASE)

Economic indicatorsExchange rates - BCI 24.02.2016 Inflation rates

Currency Buy Sell

EUR 49,56 50,56

USD 45,00 45,90

ZAR 2,95 3,01

Month Rate

January 2,48

December 4,76

November 1,83


The CTA warned this week that the country's economy and salaries could be affected by the current national situation characterized by drought, floods, political and military tension and the decline of the metical against the dollar. The alert was launched in Maputo by the CTA’s vice president, Rui Monteiro, at the end of the first plenary session of the Consultative Labour Commission (CCT), which took stock of the economic and social performance of 2015 and will provide bases for the salary adjustment in Mozambique. The national minimum wage is adjusted annually with effect from April 1.

According to Monteiro, the tension could retract carriers and affect tourism activity, while natural disasters also influence economic growth forecasts. The CTA’s vice president added that in 2015, the country faced problems because of the international situation, which could redouble in the current year. The decline of the metical has changed the structure of economic activity. The purchasing power of the majority of Mozambicans could start to drop dramatically, exacerbating poverty, said the representative of the Organization of Workers of Mozambique-Union Center, Helena Ferro.

The government of Mozambique has received a grant integrated in the Education Sector Support Fund (FASE) and intends to apply part of these funds for payments such as the contract FASE-914/15/DAQUI/QCBS/SC related to Audits for Procurement, according to the Memorandum of Understanding signed between the Ministry of Education and human development and cooperation partners. The objective of the audit is to contribute to increase the capacity of the Ministry in the area of procurement through an evaluation of the processes of acquisition of goods, works and consulting services in the year they were performed, assessing whether the processes were performed in an efficient, economic and effective way and within the limits issued by the main guidelines.

The tender is international and valid for a period of three years. Interested consultants can obtain further information at the address below from 8 a.m. to 3:30 p.m. until the week preceding March 8. Expressions of interest must be delivered to the address below by 10 a.m. on March 8.

Ministério da Educação e Desenvolvimento Humano Departamento de Aquisições Av. 24 de Julho, 167, 3o andar, sala 1310 Maputo Tel: +258 21 49 03 35 Email: [email protected]




Tax Calendar - February 2016

Until end of FebruaryPayment of the VAT of the previous month, by taxpayers of the normal system Art. 32-1 of the VAT Code approved by Law 32/2007, of December 31.

Until end of March Payment of the Vehicle Tax, Art.1-8 of the ISV approved by Decree No 19/02, of July 23.

Until end of MarchDelivery of the annual income statement from the previous year - Model 10 and Annex (for taxpayers of the 1st Category) , Art.13-1-a of the CIRPS Regulation approved by Decree No. 8 / 2008 of April 16.

Until end of MarchDelivery of the withholding statement communication, Art 44-1-c of the CIRPS Regulation approved by Decree No. 8 / 2008 of April 16 - Model 20H.

Until end of MarchDelivery of the withholding statement communication of non- residents - Art.44.6 of CIRPS Regulation, approved by Decree No. 8/2008 of April 16 - Model 20I.

Until end of AprilDelivery of the annual income statement from the previous year - Model 10 and Annex (for taxpayers who have earned income from other categories) - Art 13-1-b of the CIRPS Regulation approved by Decree No.8/ 2008 of April 16.

Until end of AprilFinal payment of the IRPS on the previous year income, Art.21-a of the CIRPS Regulation approved by Decree No. 8 / 2008 of 16 April.

Until end of MaySubmission of the annual income statement from the previous year by taxpayers - Art 39-1 of the CIRPC Regulation approved by Decree No. 9 / 2008 of April 16 - Models 22 and 22A.

Until end of MayFinal payment of the IRPC on the previous year income - Art 27-1 of the CIRPC Regulation approved by Decree No. 9 / 2008 of April 16.

Until end of MayFinal payment of the IRPS on the previous year income - Art 21-b of the CIRPS Regulation approved by Decree No. 8 / 2008 of April 16.

Until end of June Submission of annual of accounting and tax statement from the previous year by IRPS and IRPC taxpayers Model 20 and Annexes, Art 40-3 of the CIRPC Regulation approved by Decree 9 / 2008 of April 16.


Newsletter CTA 267

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