Mozambique’s transition from a post-conflict country to one of Africa’s “frontier economies” has been nothing short of impressive. Emerging from years of conflict to become one of the continent’s best performers, Mozambique grew at an average annual rate of 6 percent – 8 percent in the decade up to 2012. The World Bank expects 2013 growth to top 7 percent, and fuelled by infrastructure spending and foreign investment in mega-projects, medium-term growth of over 8 percent.
Spurred on by political stability, steady macroeconomic management, reconstruction, and structural reforms, Mozambique’s economic growth has also been bolstered by a boom in large foreign investments in the burgeoning energy and natural resources sectors. Indeed, FDI doubled to $5.2 billion in 2012. A world-class destination for mining and natural gas development, Mozambique also possesses vast untapped coal reserves that have attracted multinationals such as Brazil’s Vale and Australia’s Rio Tinto. Recent gas and coal discoveries are set to be a major source of new prosperity for a nation that, despite its growth, still grapples with the manacle of poverty.