1. The Mozambique Experience Dr Pascoal Mocumbi
CAR Leadership Seminar,
Bangui, December

2. Outline
Context: from a war-torn country – the end of a dream – to a “success story”
Post-war reconstruction and reforms
Implementing change and reforms

3. Context: from a worn-torn country…
1975: Euphoria of independence
International solidarity movement – racism & apartheid
: destabilisation increases
End 1980s: war spreads to entire country, Mozambique becomes one of the world’s poorest countries

4. Context: from a worn-torn contd...
1987: Economic and Social Rehabilitation Program (ESRP), to address the fundamental causes of economic crisis
October 4, 1992: peace agreement signed – triggered by realization that without war, the financial situation of Mozambique would be considerably better (like CAR – a rich country)

5. …to a “success story” One of fastest growing economies of the world
Peace and stability maintained since 1992
3 cycles of general elections (Presidential and parliamentary)
Decentralization and community participation

6. Transition under UN supervision
National reconstruction and resettlement program adopted
Clearance of landmines
Reintegration of demobilised soldiers
Preparation of elections

7. Post-war reconstruction
Following 1994 elections: 5-year program centred on poverty reduction adopted, focusing on reconciliation, national reconstruction and economic recovery
Priorities:
- Maintaining peace and political stability
- Sound macroeconomic framework
- Recovery of major roads

8. Post-war reconstruction (contd.)
Adjustment of State institutions
Public sector reform
- professionalism of public administration
- combat corruption
- increase budget revenues (introduction of VAT, customs reform)
Improvement of communication channels and accountability between gvt. and society

9. Implementing change and reforms
Poverty reduction through focus on increasing agricultural production
Promotion of reconciliation through effective management of potential conflicts
Trade reforms opening up the economy internationally – substantial increase in foreign investment
Mobilising assistance from international community and accountability

10. Lessons learned: Crucial factors
Strong political commitment and leadership
Clear vision and strategy responding to challenges identified – staying the course
Prioritisation – addressing most urgent needs first
Ability of leadership to build consensus in decision-making process – involvement of different groups of opinion
Appropriate interface between policy makers and implementers
Strengthening state capacity for revenue collection

11. Constraints and challenges
Very weak human capital base
Inadequate infrastructure
Tightening macroeconomic constraints
Structural reforms take time

12. Solutions Initiate change while managing emergency
Consultation on “what to change and what for?” to build consensus on principles and “rules of the game”
Lead by example – showing what is accepted behavior

13. Mozambique Customs Reform
Why Reforms?
- evidence of internal weakness capacity to collect revenues and control trade into
and out of the country
- civil society criticism on lack of gvt transparence in customs operations, poor management
- domestic industry complained that could not compete with smuggles on domestic market

14. Customs reforms - Objectives
Combat corruption and smuggling: smuggling rings were firmly entrenched and it would be difficult to break out from within
Increase budget revenue: customs revenues were on a downward trend since 1992 and accelerated in 1994
Modernize customs services
Facilitate legitimate trade

15. Strategy – create a technical unit
Main components:
- Human resources
- Legislation and procedures
- Organizational profile
- Infrastructures and equipments

16. Outcomes to Date Efficiency of collection improved
Expressive growth of fiscal revenues
Trade facilitation: clearance times reduced
Modern institutions managed by nationals
A new customs Code issued in 1998 on the customs e-network and answers to frequently asked questions from importers and exporters.