27 August 2013

Mozambique: A Boom for Whom? Mozambique's Natural Gas and the New Development Opportunity

analysis

SAIIA Occasional Paper No 151, August 2013

In the two decades since the end of Mozambique's civil war the country has depended heavily on international donors to fund its development. Although the economy grew at record rates from the mid-1990s, poverty levels remain above 50%. Mozambique has now discovered natural gas deposits in large commercial quantities.

These discoveries could contribute billions of dollars to the economy and catapult Mozambique into place as the world's third largest exporter of LNG.

This paper investigates the likely impact on Mozambique's socio-economic development of discoveries of natural gas deposits, and of industrial development in the natural gas sector.

It analyses the likely uses of the 'gas boom' by government in contributing to the improvement of the economic situation of Mozambicans. The discussion is set within the context of Mozambique's political and economic development since gaining independence in 1975.

Whether or not the new opportunity will translate into real benefit for Mozambicans in general depends on a number of critical factors: This report looks at those issues against the background of the need for development in Mozambique and concludes that, although natural gas presents a great opportunity for development and the government appears to be committed to using the resource to improve the lives of Mozambicans, much work lies ahead.

Translating Mozambique's natural resource wealth into developmental outcomes will require commitment from all stakeholders, especially the government, civil society and the private sector.

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