Although the general investment climate in Mozambique has improved significantly over the last few years with economic growth rates among the highest in Africa, political stability and government promotion of foreign direct investment, corruption remains a serious problem for foreign investors. In fact, most observers agree that corruption is one of the main constraints for doing business in Mozambique.
Positive developments in relation to corruption and investment:
- EITI Mozambique, a subset of the global initiative Extractive Industries Transparency Initiative (EITI), was established in 2009 to strengthen resource revenue transparency. At this period of review, Mozambique is in the candidacy stages of the process.
- The Investment Promotion Centre (CPI) has been established by government as a one-stop shop for investors and has reportedly helped to improve the regulatory environment.
- Much work has been done in the field of modernising, increasing efficiency and improving the integrity of Mozambique's customs administration. Reportedly the efforts have reduced the magnitude of corruption in the sector, although the level of corruption remains high.
- In 2010, the first corruption case on a ministerial level concluded in Mozambique, with the conviction of former Transport Minister Antonio Munguambe.
Risks of corruption:
- According to several sources, public procurement is an area of business activity where foreign companies are very likely to encounter corruption.
- The judiciary remains one of the weakest sectors in Mozambique. The judiciary is not only subjected to political interference from the ruling elite, but also to criminal networks and people with wealth.
- Companies rank the police, traffic police in particular, as the most dishonest institution in Mozambique's public sector.
- Protection of whistleblowers remains weak, and there have been cases where witnesses or whistleblowers were harassed after denouncing crimes of corruption, or the theft of state funds.