Overview

Mozambique’s digital transformation has undergone rapid acceleration since 2020, although only 21.7% of the population were internet users in January 2021 according to analysis from Kepios; most of these were through low-speed mobile networks. The impact of the COVID-19 pandemic led companies and users to move to online platforms and remain sustainable throughout the pandemic by establishing remote work systems. Further, the government mitigates the pandemic impact by ensuring provision of public services virtually. It obtained approval of a $150 Million grant from the World Bank to support Digital Governance and Economy Project (EGDE) which focuses on increasing access to civil identification, digital public services and improving digital business opportunities.

The telecommunications market is structured around three vertically integrated operators including: Vodacom, a private enterprise majorly owned by South Africa’s Vodacom Group; Movitel, a joint venture between the Viettel Group of Vietnam and Mozambique’s ruling party Frelimo; and TMcel, a merger between Mozambique’s former telecommunication state-owned enterprise (TDM) and cellular network provider (Mcel). Although Vodacom is the dominant mobile phone operator in Mozambique with almost 50% market share, TMcel is the only entity that continues to offer integrated fixed line service. According to World Bank, Mozambique registered approximately 16 million mobile subscriptions in 2020 which corresponds to more than half of the population.

The high cost of devices, especially smartphones, a low 48% literacy rate, and unfamiliarity with the Internet pose as major barriers to internet connectivity. Furthermore, the high connectivity discrepancy between rural and urban areas fueled by limited access to electricity and financial services continue to plague rural households. Conversely, emerging mining and energy projects continue to drive ICT infrastructure investments in rural areas.

Sub-Sectors

Broadband

There is major discrepancy in connectivity between urban and rural areas. Maputo is Mozambique’s largest and best-connected city, although challenges in infrastructure, market maturity and affordability cripple connectivity throughout the country. Additionally, data traffic is expensive to carry out of Maputo. This has resulted in data becoming more expensive in the north of the country than in the south.

Mozambique aims to tackle this discrepancy by establishing digital villages, an infrastructure scheme which will improve connectivity and ICT access in rural areas. Mozambique is currently connected to two subsea cables, and Facebook has announced plans to land 2Africa cable system in the north of the country between 2023 and early 2024. Similarly, Starlink, the satellite internet service from SpaceX, received its first license to operate in Africa from Mozambique early 2022. Not only does the company plan to connect rural areas of the country, but announcement of its market entry immediately brought down data prices from incumbent companies.

Cybersecurity

Mozambique’s digital transformation also brings new threats to end-users, including the Mozambican Government and the private sector. Public entities face looming challenges and risks from the online storage of information of citizens who depend public services. As a result, the Government of Mozambique has identified cybersecurity as a priority segment to the country’s digital transformation process.

The National Cybersecurity Strategy aims to implement 25 projects by 2025 and established a multi-sectoral council with a mandate to coordinate a governance framework. The Government tends to include minimum cybersecurity requirements in public procurement contracts to meet minimum ICT requirements, but with the digital transition there is a demand for outsourced solutions, such as encryption for network access, intrusion prevention systems (IPS), advanced persistent threat (APT), email phishing security, and cybersecurity training.

Cloud Computing

The Government of Mozambique operates Maluana Park and four other data centers in the country. As part of the government’s e-governance strategy, Maluana Park is set to centralize and host the Government’s public administration computing systems.

Amazon Web Services (AWS), Heroku, and Microsoft Azure are among the many international companies that offer cloud services to Mozambique, but do not operate their own in-country data centers. Recently, private entities have announced plans to build data centers, including U.S. investment firm Roha, which aims to build and operate a world-class tier 3 data center in partnership with high-tech group Raxio.

Opportunities

Many opportunities exist for U.S. companies that can develop secure and resilient critical information infrastructure (CII), including:

• $150 million grant from the World Bank to support the Digital Governance and Economy Project to improve digital public services and digital business opportunities
• Establishment of two data centers in the North (Mocuba and Nacala)
• Infrastructure improvement for its E-Government Network
• Multimedia Community Centers.