Selling to the Government

The Public Procurement Regulations governing the public tender process apply to all municipalities and (majority) state-owned companies. Public tenders are required for all government procurements over $10 million. The regulations cover products, services, and concessions in general, and are subject to some industry-specific regulations, such as mineral resources, public private partnerships, and large-scale projects, for example. The Unit for the Supervision of Acquisitions (UFSA) within the Ministry of Economy and Finance’s National Directorate of State Assets (DNPE) is responsible for applying and overseeing the Public Procurement Regulations.

Purchases may also be subject to the terms defined by international donors or investment agencies financing specific projects. In order to be eligible, the general bid standards stipulate that all individual or legal persons from Mozambique or abroad must demonstrate to the Government that the company is legal, financially, and technically qualified, and has a taxation record.

U.S. companies bidding on Government tenders may also qualify for U.S. Government advocacy. A unit of the U.S. Commerce Department’s International Trade Administration, the Advocacy Center coordinates U.S. Government interagency advocacy efforts on behalf of U.S. exporters bidding on public sector contracts with international governments and government agencies. The Advocacy Center works closely with our network of the U.S. Commercial Service worldwide and inter-agency partners to ensure that exporters of U.S. products and services have the best possible chance of winning government contracts. Advocacy assistance can take many forms but often involves the U.S. Embassy or other U.S. Government agencies expressing support for the U.S. bidders directly to the foreign government. Consult Advocacy for Foreign Government Contracts for additional information.

USAID

The U.S. Agency for International Development (USAID) has a particularly large presence in Africa, and Mozambique is no exception. The agency’s Business Forecast – including Mozambique – provides information about potential funding and partnership opportunities at USAID and offers partners the opportunity to engage early in the procurement process. The Business Forecast is issued while activities are still in the planning phase, so the information in it may change over time. To receive alerts on Business Forecast updates, conference calls, and resources, sign up for the USAID Acquisition and Assistance email list. Once activities on the Business Forecast makes its way through the procurement process, it ends up on either Sam.gov (contract opportunities) or Grants.gov (grants and cooperative agreement opportunities).

Further information can be found on Work with USAID and the one-page summary Doing Business with USAID lists many further resources.

Millennium Challenge Corporation

The United States Government’s Millennium Challenge Corporation (MCC) is in active collaboration with the Government of Mozambique, via the Compact Development Team (Gabinete do Desenvolvimento do Compacto-II; GDC), to develop a program focused on addressing selected root causes of Mozambique’s binding constraints of (1) poor agricultural policy, legal and regulatory framework, and (2) poor and climate vulnerable secondary and tertiary road infrastructure and low freight transport market competitiveness. The Government of the Republic of Mozambique has asked MCC to work in the strategic and highly impoverished Province of Zambezia to actively promote inclusive economic opportunity, climate and coastal resilience, and improved quality/access to public services and infrastructure. MCC will continue to engage with the people and government of Mozambique, as it works towards finalizing Compact II in 2023.

MCC is considering the following projects for Mozambique:

• Connectivity and Rural Transport
  • Climate-smart, sustainable, and cost-effective rural road transport connectivity
  • Complementary sector reforms and institutional capacity building
  • Catalyze private sector-led strategies and investment
• Investment Promotion in Commercial Agriculture
  • Reform institutions and policies to catalyze an inclusive commercial agriculture sector
  • Strengthen the investment framework, capacity, and agricultural production
  • Support gender-equitable opportunities and solutions
• Integrated Climate Management and Coastal Development
  • Enable community-led mangrove and seagrass reforestation and land-use planning
  • Investigate the feasibility of marine economies and potential application of blue carbon credits

Project Financing

Major projects are typically financed through foreign development grants and concessionary financing. The dominance of banking in the financial sector, prevailing high interest rates, and short repayment terms combined with underdevelopment of the Mozambique Stock Exchange (Bolsa de Valores de Mocambique, or BVM) limit the local capacity for raising capital for capital expenditure projects. As a result, many of the country’s proposed infrastructure projects are based on public-private partnership frameworks with 15–30-year concessions. The government has made effort to create bankable, financially viable project financing to attract international investors to back certain marquee projects, like the recently completed Temane Thermal Power Station and the upcoming Mphanda Nkuwa Hydroelectric Dam.

Multilateral Development Banks and Financing Government Sales

Price, payment terms, and financing can be a significant factor in winning a government contract. Many governments finance public works projects through borrowing from the Multilateral Development Banks (MDB). A helpful guide for working with the MDBs is the Trade Finance Guide. The U.S. Department of Commerce’s (USDOC) International Trade Administration (ITA) has a Foreign Commercial Service Officer stationed at each of the five different Multilateral Development Banks (MDBs): the African Development Bank; the Asian Development Bank; the European Bank for Reconstruction and Development; the Inter-American Development Bank; and the World Bank. 

Learn more by contacting the Commercial Liaison Office to the African Development Bank and the Commercial Liaison Office to the World Bank.

Power Africa

Power Africa is a market-driven, U.S. Government-led public-private partnership aiming to double access to electricity in sub-Saharan Africa. It offers tools and resources to private sector entities to facilitate doing business in sub-Saharan Africa’s power sector.  The Electrify Africa Act of 2015 Institutionalized Power Africa. Learn more about the full Power Africa toolbox or other opportunities offered by Power Africa. 

U.S. Government Support

The Export-Import Bank of the United States offers loan guarantees, insurance, and project financing to encourage the export of U.S. goods and is keenly interested in the Mozambican market. Consult the Country Limitation Schedule for more information on the banks’ available services for the Mozambican market.

The U.S. International Development Finance Corporation (DFC) is America’s development bank. DFC partners with the private sector to finance solutions to the most critical challenges facing the developing world today. It can assist with project finance, through loans or loan guaranties, and political risk insurance in Mozambique.

Small business owners exploring the market can contact the Small Business Administration’s Office of International Trade.

The U.S. Trade and Development Agency can provide feasibility study and training grants for certain infrastructure projects. 

Availability of United States Department of Agriculture (USDA) Export Credit Guarantee Program (GSM) – The USDA provides GSM credit guarantees to assist in financing exports of U.S. agricultural products overseas. While no Mozambican banks are currently eligible for the program, eligible banks elsewhere in the region may be able to cover exports to Mozambique. The USDA Commodity Credit Corporation has a range of export and foreign assistance programs to promote the export of American agricultural commodities. Interested exporters are advised to contact the U.S. Foreign Agriculture Service.