AfDB to support Mozambique SMEs in the construction sector along Nacala Corridor

The African Development Bank’s Board of Directors has approved a US $1-million African Private Sector Assistance Fund (FAPA) grant to the Government of Mozambique to finance the Nacala Corridor Business Linkages Technical Assistance Project.

The project is in line with the Bank’s effort to promote inclusive private sector development and SME linkages with large investments. It also aims to promote corridor economic development through the integration of economic activities within infrastructure development along the Nacala corridor.

The Bank has made various infrastructure investments to support the Nacala corridor. To strengthen the inclusiveness of these investments, the Bank designed two technical assistance projects, a value addition project in Malawi and a business linkage project in Mozambique.

The Mozambique Nacala Corridor Business Linkages Technical Assistance Project is aimed at improving the efficiency and competitiveness of SMEs in the construction sector situated in the Nacala Corridor to enable them take advantage of business opportunities provided by the Nacala rail and port projects and other large construction investments. The project is designed to complement the Bank’s private sector Nacala rail and port project in order to support inclusive and sustainable economic growth along the Nacala corridor.

In the next three years, the project will: strengthen the business management skills, industry knowledge and know-how of selected SMEs in the construction industry through training, coaching, mentorship and other support activities to help them attain competencies required to satisfy requirements and standards of larger partner companies; provide institutional capacity building, knowledge, expertise and tools to SME support institutions to enable them continue supporting SMEs in construction industry at the end of the technical assistance; and build strong networks and stakeholder platforms for construction sector’s continuous dialogue with the government, banks, insurance, tax administration, training institutions and the large private sector operators on various aspects that will further business growth in Mozambique.

FAPA is a multi-donor thematic trust fund that provides grant funding for technical assistance and capacity building to support implementation of the Bank’s Private Sector Development Strategy. The Governments of Japan and Austria and the African Development Bank, are active contributors to the fund, which to date has provided over US $51 million to 65 projects (24 of which are regional projects with 41 others located in 24 individual countries across the African continent).

The FAPA portfolio includes projects aimed at improving the business environment, strengthening financial systems, building private sector infrastructure, promotion of trade and development of micro, small and medium enterprises.

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