World Bank2012-03-192012-03-192009-10-01https://hdl.handle.net/10986/3158Mozambique's recent history is a rare example of a successful post-conflict recovery and economic takeoff. Emerging from decades of economic stagnation and decline, a consequence first of a failed socialist economic experience and then of a vicious civil war that only ended in 1992, the country has achieved a commendable degree of political stability. This has been accompanied by prudent and stable economic policy continuity, as well as coordinated and ever more efficient use of substantial international aid. These factors have contributed to sustained economic growth that averaged 7.8 percent between 1992 and 2006. Furthermore, this growth has been 'pro-poor': increasing output has been accompanied by real and significant decreases in poverty levels, with the poverty headcount index declining from 69 percent in 1997 to 54 percent in 2003. Based on the enterprise survey results for Mozambique, this report assesses the main obstacles to achieving an investment climate that supports private sector growth and provides policy options for improving the business environment and increasing competitiveness with the goal of achieving sustained and broad-based growth. The focus is on microeconomic constraints and reforms where, according to a recent World Bank report, most of the challenges for sustainable growth are concentrated. Therefore, the analysis presented in this report should be of interest to policy makers, academics, non-governmental organizations and representatives of the private sector involved in the policy dialogue in the country. Improvements to the business environment and increased access to finance are the most critical aspects to firm growth in Mozambique identified in this report. Despite recent progress, the business environment for the Mozambican enterprise sector is still in many ways problematic. Based on econometric evidence as well as on business perceptions and quantitative data, this study indicates that while all aspects of the investment climate are important, reform priorities should focus on increasing access to finance and improving the business environment.CC BY 3.0 IGOACCESS TO CREDITACCESS TO FINANCEACCESS TO MARKETSACTION PLANAGRICULTURAL ACTIVITIESAGRICULTURAL OUTPUTAGRICULTURAL PRODUCTSAGRICULTURAL SECTORAPPLICATION PROCEDURESAUTOMATIONBANK FEESBANK FINANCINGBANKING SECTORBANKING SERVICESBANKRUPTCYBANKSBORDER CROSSINGBOTTLENECKSBRIBESBUSINESS ACTIVITYBUSINESS CLIMATEBUSINESS ENVIRONMENTBUSINESS INDICATORSBUSINESS OPERATIONBUSINESS OPERATIONSBUSINESS ORGANIZATIONSBUSINESS REGISTRATIONBUSINESS REGULATIONBUSINESS REGULATIONSBUSINESSESCAPACITY BUILDINGCAPITAL ACCOUNTCAPITAL GOODSCAPITAL INVESTMENTSCAPITAL REQUIREMENTCOLLATERALCOLLATERAL REQUIREMENTSCOMMERCECOMMODITIESCOMMODITYCOMMODITY PRICESCOMPARATIVE ADVANTAGECOMPLIANCE COSTSCORRUPTIONCPICREDIT CONSTRAINED FIRMSCREDIT CONSTRAINTCREDIT CONSTRAINTSCREDIT INFORMATIONCREDIT LINESCREDIT RISKCUSTOMSDEBTSDEPOSITSDEVELOPMENT ASSISTANCEDIESELDIVERSIFICATIONDRIVERSE-MAILECONOMIC ACTIVITYECONOMIC GROWTHECONOMIC POLICYECONOMIC REFORMECONOMIC REFORMSEDUCATIONAL ATTAINMENTELECTRICITYEMPIRICAL ANALYSISEMPLOYEEEMPLOYMENT CREATIONEMPLOYMENT GROWTHENDOWMENTSENTERPRISE DEVELOPMENTENTERPRISE SECTORENTERPRISE SURVEYENTERPRISE SURVEYSENTREPRENEURSEQUIPMENTEXCHANGE OF INFORMATIONEXCHANGE RATEEXCHANGE RATESEXPENDITUREEXPENDITURESEXPORT PERFORMANCEEXPORTEREXTERNAL FINANCEFINANCIAL INTERMEDIATIONFINANCIAL LITERACYFINANCIAL MANAGEMENTFINANCIAL MARKETFINANCIAL SECTOR ASSESSMENTFINANCIAL SECTOR REFORMFINANCIAL SERVICESFINANCIAL SYSTEMFIRM PERFORMANCEFISCAL POLICIESFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFOREIGN FIRMSFOREIGN INVESTMENTFORESTRYFUELSGENDERGENDER DIFFERENCESGLOBAL COMPETITIVENESSGLOBAL MARKETSGREATER ACCESSGROSS DOMESTIC PRODUCTGROUP OF FIRMSGROWTH STRATEGYGUARANTEE SCHEMESHARDWAREHOLDINGSHUMAN CAPITALINFLATIONINFORMAL ECONOMYINFRASTRUCTURE COSTSINNOVATIONINSPECTIONINSPECTIONSINTELLECTUAL PROPERTY RIGHTSINTEREST RATEINTEREST RATESINTERNAL FUNDSINTERNATIONAL BANKINTERNATIONAL BANKSINTERNATIONAL COMPARISONINTERNATIONAL COMPARISONSINTERNATIONAL DEVELOPMENTINTERNATIONAL FINANCEINTERNATIONAL STANDARDSINVENTORYINVESTMENT BANKINVESTMENT CLIMATEINVESTMENT FINANCINGJOB CREATIONLABOR COSTSLABOR MARKETLABOR MARKETSLABOR PRODUCTIVITYLEGAL REFORMLICENSELICENSESLINES OF CREDITLOANLOAN SIZELOCAL MARKETLOCOMOTIVEMACROECONOMIC POLICIESMANUFACTURINGMEDIUM ENTERPRISEMEDIUM ENTERPRISESMICROENTERPRISESMINIMUM WAGEMONETARY FUNDMONETARY POLICIESNETWORKSNEW BUSINESSESNEW TECHNOLOGIESONE-STOP SHOPSOVERDRAFTPHYSICAL INFRASTRUCTUREPOINT OF SALEPOLICY MAKERSPOLITICAL STABILITYPRIVATE INVESTMENTPRIVATE INVESTORSPRIVATE SECTORPRIVATE SECTORSPRIVATIZATIONSPROCUREMENTPRODUCTIVITY GROWTHPROFIT MARGINSPROPERTY RIGHTSPROTECTION OF INTELLECTUAL PROPERTYPURCHASING POWERQUOTASRAILRAILROADRAILROADSREFUGEESREGISTRYREGULATORY ENVIRONMENTREGULATORY FRAMEWORKREMITTANCESRESERVE REQUIREMENTSRESULTRESULTSRETAINED EARNINGSROADROADSSECURITY SERVICESSHADOW ECONOMYSMALL ENTERPRISESSMALL INVESTORSSOCIAL SECURITYSOCIOECONOMIC BACKGROUNDSSOURCES OF INCOMESTART-UPSUSTAINABLE GROWTHTARGETSTAXTAX RATESTAX REFORMTECHNICAL SKILLSTELECOMTELECOMMUNICATIONSTELEPHONETOLLTRADE FACILITATIONTRADE REGIMESTRANSITTRANSPARENCYTRANSPORTTRANSPORT NETWORKTRANSPORT TAXTRANSPORTATIONTRANSPORTATION INFRASTRUCTURETRANSPORTATION SYSTEMTRAVEL COSTSTURNAROUND TIMESUNFAIR COMPETITIONUNIONURBAN AREASUSERSUSESVALUE CHAINVEHICLESVILLAGESWEALTHWEBWEB SITEWORKING CAPITALWORLD TRADEWorld Bank10.1596/3158