[2019-09-10] Germany finances agriculture in Mozambique with a credit line

Source: Macauhub

The German Government has opened a 10 million-euro credit facility to finance micro, small and medium enterprises in Mozambique’s agricultural sector, and contracts were signed on Monday in Maputo.

The Governor of the Bank of Mozambique, Rogério Zandamela, said he hoped that this line of credit will contribute to poverty alleviation and increased economic inclusion, in a speech given at the signing session of credit agreements with four Mozambican banking institutions that will intermediate funds made available by the German development bank KfW.

Zandamela also said that this financing is of particular importance to boost the agricultural sector, which supports about 75% to 80% of the Mozambican population and represents about 25% of the country’s total Gross Domestic Product (GDP).

“Notwithstanding their considerable weight in GDP, levels of agricultural finance over the past five years remain relatively low at around 3 to 4 percent per year,” said Zandamela, quoted by the Deutsche Wella newspaper.

Bank of Mozambique director Jamal Omar has agreed that the cost of this financing will be as low as possible and may not exceed an interest rate of 15%.