Mozambique’s green growth policy development

Mozambique, January 2016 - Throughout the last few years, Mozambique has experienced at the same time both strong economic growth and persistent poverty. It has discovered large new coal and natural gas reserves while facing a declining natural resource base. It has increasingly faced the emerging challenges posed by climate change.

To respond to these challenges, the Government of Mozambique (GoM), together with the African Development Bank and other key development partners, launched in 2012 a high-level Roadmap for a Green Economy (GER). The roadmap establishes ambitious targets for Mozambique: to become an inclusive middle income country by 2030, which uses its resources rationally to preserve its ecosystems and a sustainable and effective development.

To operationalize the ambitious goals of the GER, the government prepared a Green Economy Action Plan (GEAP). Approved by the Council of Ministers on 15th October, 2013, the GEAP preparation has included the participation of all relevant ministries and other government bodies and benefited from a public consultation process, done at the national and regional levels, with inputs from regional and local authorities, civil society and private sector.

The GEAP was expected to shape the government's 5-year plan and to provide the basis for greening the National Development Strategy currently under development by the GoM. The plan is built on three pillars: sustainable infrastructure, efficient and sustainable use of natural resources and strengthening resilience and adaptability. These pillars include 15 sub-sectors and a total of 119 green growth policy options were identified through the technical review and consultative process by the GoM.

In 2015, the African Development Bank together with other development partners, namely the World Wide Fund (WWF), the United Nations Environment Programme (UNEP) and the United Nations Development Programme (UNDP) published a new report: “Transition Towards Green Growth in Mozambique”. This document provides a summary of Mozambique’s green growth policy development as detailed in the GEAP developed by the GoM.

The report aims to support the Sustainable Development Goals (SDGs) under the country’s ‘Green Economy Action Plan’. In particular, this report elaborates on the advisory process by the Bank, reviews main findings at sector and institutional level and makes recommendations for the government on policy reform and identifies options for the Bank’s continued engagement in this agenda.

First of all, the report says the key “new financing instrument”  under the GEAP should be “a green economy investment fund, to be established with revenues from fees on extractive industry activities”. Monies raised would be invested in “a diversified portfolio of financial assets” such as shares, bonds and real estate, with income invested in green economy activities. However, the “boom” in extractive industries “poses challenges alongside opportunities,” the report says.

The document also highlights “that policies should focus in particular on projects such as mini-grids, “with a view to increasing access to sustainable energy services to peri-urban and rural populations”. This could be supported by “harnessing the country’s vast potential in hydro, solar, wind and biomass.”

The conclusions of the report underline GEAP’s challenge to come at a “crucial time when the country is faced with new development opportunities from natural resources exploration that pose critical short, medium and long-term sustainability challenges . Its breadth and thoroughness at the same time represent a tremendous challenge, which the GEAP itself acknowledges, facing institutional, informational and financial hurdles to implementation, and a process of priority setting among a range of potential policy measures. The development of the GEAP nevertheless represents a promising pathway to a greener and more inclusive Mozambique.”

 

Sources:

http://www.out-law.com/en/articles/2016/january/report-urges-mozambique-to-create-green-investment-fund-for-infrastructure-/

http://www.afdb.org/fileadmin/uploads/afdb/Documents/Generic-Documents/Transition_Towards_Green_Growth_in_Mozambique_-_Policy_Review_and_Recommendations_for_Action.pdf