EU Relations with Mozambique

General Overview: developments, challenges and prospects 

The end of civil war in 1992 allowed Mozambique to experience a new era of stability, a multi-party system and substantial economic growth gains. Mozambique is now at an important crossroads, both in political, economic and social terms as new challenges and opportunities arise in its struggle for democratisation and development. 

In the political sphere, it is important to maintain ongoing efforts to find lasting solutions to difficulties that have led to increased tension. The EU and its Member States have been proactive in encouraging constructive dialogue between the government and the Renamo (the Mozambican National Resistance). Implementing the recent ‘memorandum of understanding’ agreed between the two will help build peace and open up the political system.

The general elections scheduled for the 15 October 2014, in which other representative political parties will participate, will be particularly important in this regard. An EU electoral observation mission has been deployed at the invitation of the Mozambique authorities.

The discovery of vast gas deposits off-shore, along with prospects for extensive coal mining, should help increase the flow of foreign investment and support significant economic development. Prospects for Mozambique becoming a middle income country by 2025-30 are realistic –the country's dependence on donors will continue to decrease and could end in the medium term

A crucial issue is whether this economic transformation will be accompanied by genuinely inclusive growth as this also requires social stability.

Moreover, addressing the country’s major structural ‘bottle necks’ is indispensable for sustainable economic growth. These are, in particular: infrastructure, energy, human resources and an adequate finance system for local businesses.  

The EU and Mozambique 

The EU is a key partner for Mozambique. Together with its Member States, the EU provides approximately two thirds of the country’s international development aid. The EU is also an important trading partner, while EU companies are among the main investors in the country. Such a privileged relation will nevertheless be challenged in the coming years, not only by Mozambique’s traditional partners (US, South Africa), but also by emerging economies (Brazil, India, China).

Mozambique is part of the EU-ACP Cotonou Agreement. 2014 was the 30th anniversary of EU-Mozambique development cooperation. The next National Indicative Programme (2015-2020) will have an initial allocation of €734m, and will focus on general budget support and rural development.

A fisheries partnership agreement with Mozambique is also in place. The current protocol covers the period 1.2.2012 – 31.01.2015 and negotiations for its renewal are underway.

In addition to the EU Delegation, 11 EU Member States have resident diplomatic representations in Mozambique (DE, DK, ES, FR, FI, IE, IT, NL, PT, SE and UK).

Regional aspects

Mozambique should, in the longer term, be one of the largest beneficiaries of the regional integration in Sub-Saharan Africa, especially where the Southern African Development Community (SADC) is concerned. The country's geographical location is an important strength: a large volume of SADC goods transits through Mozambique, along corridors linking Mozambique’s ports with neighbouring, landlocked countries (as well as important regions in South Africa).

An Economic Partnership Agreement (EPA) was recently concluded with the SADC region, offering duty-free, quota-free access to the EU market, while Mozambique will remove barriers to free trade for around 80% of its trade with the EU. As a less developed country, Mozambique already benefits from substantial advantages when trading with the EU.

Mozambique – through SADC – is also negotiating a Regional Indicative Programme (2015-2020) in the framework of the Cotonou Agreement (11th EDF).