Crime, corruption hinder Mozambique business: W.Bank

By Charles Mangwiro

MAPUTO (Reuters) - A failure by government to combat crime and corruption and difficulties accessing finance are constraining growth of the private sector in Mozambique, the World Bank said in a report on Monday.

The World Bank's Investment Climate Assessment report said while large-scale projects had driven economic growth, they had failed to create sustainable jobs.

Official unemployment in Mozambique is at 60 percent and many people live in rural areas and work in agriculture.

"Informal tendering, crime, corruption, difficult access to finance, taxes, energy and transport are largely the consequences of challenges in the regulating of the economic activity and the quality of governance in Mozambique," the report said.

The World Bank did the study among 599 companies last year and urged the southern Africa nation to fast-track reforms.

"Mozambique must continue to reform its legislation for private economic activity, particularly the small and medium enterprises."

"It must increase productivity and simplify the licensing of businesses as well as establishing trade tribunals including the simplification of fiscal obligations and customs duties for smaller investors."

Kekobad Patel, President of the Customs, Fiscal and International Trade Policy Committee of the Confederation of Business Associations of Mozambique told Reuters reform had been of little benefit to the business sector in the country.

"Government is making the changes (in business sector) and reforms needed but the reality is that we are not sufficiently speeding the reforms. While other countries do three steps (in reforms) in Mozambique we are on one step," said Patel.