NATIONAL INTELLIGENCE SURVEY 58; MOZAMBIQUE; THE ECONOMY

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Centra' Intelligence Agency. Research was sub
stantially completed by May 1973.
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CONTENTS
This chanter supersedes the economic coverage
in the General Sumxv dalcd August 1987.
A. Economic appraisal 1
B. Structure of the econoruy 2
1. Agriculture, fisheries, and forestry 2
a. Soils and climate 2
b. Agrieulture 2
c. Fisheries 5
d. Forestry 5
2. Fuels and power 5
I Metals and minerals 6
CONFMLN
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FIGURES
Page
Page
Page
4. Manufacturing and construction
7
2. Development
10
5. Domestic trade
8
3. Manpower
10
Q Economic policy and development
8
D. International economic relations
11
I. Policy ...................I
8
1. Foreign trade
11
a. Government finance
3
2. Balance of payments
12
b. Money and banking
9
3. Foreign aid
12
FIGURES
it
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Page
Fig. 1
Estimated land use (chart)
2
Fig. 2
9stimated production of major
7
Fig. 8
cash crops stable)
3
Fig. 3
Major crop areas and fishing ports
8
Fig. 9
(map) 3
Fig. 4
Estimated production of major food
External trade (chart;
1
crops (table)
5
Fig. 5
Livestock population (tabl
5
Fig. 6
Production of principal minerals
Balance of payments (table)
13
(table)
7
it
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Page
Fig.7
Output of major manufacturing
industries chart)
7
Fig. 8
Major industrial and mining centers
(snap)
8
Fig. 9
Government budgets (table)
9
Fig. 10
External trade (chart;
1
Fig. 11
Major exports (table)
11
Fig. 12
Direction of trade (chart)
12
Fig, 13
Balance of payments (table)
13
it
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Ai' d^ 1cA% 4Y-' l: C'+ ti=' sG l.LA(`p'+an+wm*u+e+�.w
The Economy
A. Economic appraisal (U /OU)
The economy of Mozambique is dominated by
Portugal, which formulates Mo imbican economic
policy. Portuguese companies own the major
manufacturing and transportation facilities and
conduct the bulk of the external trade as well as the
most important domestic business. As an overseas sta'^
of Portugal, Mozambique is a member of the escudo
monetary zone, through which it shares monetary and
payments systems and development plans with
Portugal and its other overseas states. About one -third
of Mozambique's trade is with metropolitan Portugal,
consisting largely of exports of raw materials and
imports of manufactured goods.
Emigration of metropolitan Portuguese to their
African states is encouraged by ?ortugal, both to
relieve shortages of skilled labor in those states and to
east: population pressure in Portugal. The white
Portuguese in Mocambique currently number about
200,000, an 80% increase since 1960. They constitute
about 290 of the population and represent the fourth
largest white population in sub Saharan Africa.
Like virtually all other African countries,
Mozambique is heavily dependent on agriculture,
which supplies most of the food for the domestic
Market, is the principal means of livelihood, and
furnishes the, bulk of exports. Cashews, cotton, and
sugar are the most important commercial crops, while
subsistence -type farming consists largely of the
production of grains and other food crops.
Mozambique relies on imports for machinery and
equipment and for it variety of consumer goods. The
value of exports, mostly agricultural goods and
mineral products, has traditionally failed to cover the
value of imports. The annual trade deficits are
partially covered by earnings from invisibles,
particularly transit trade and tourism. Mozambique's
railroads and ports form an integral part of the
transport network of south- central Africa, and charges
on goods carried between the interior countries-
Zambia, Rhodesia, Malawi ---and Mozambique's
ports of Lau reliC'n Marques,' Beira, nd Nacala
provide one- fourth to one -third of total foreign
exchange eamings.
Manufacturing is of growing importance. Industrial
production increased by 97c in 1971 and now accounts
for 207o of the gross national Vmduct (GNP It
includes the processing of agricultural products, the
manufacture of textiles and other consumer goods,
and the production of cement and other construction
materials. Mocambique has a wide variety of mineral
resources, and reining will no doubt gruw in
importance. Coal is currently the leading mineral
produced in the country. Although MolxTnbictuc
produces no oil, it does have a substantial refining
industry to fill local demand and provide exports
M,,zamisique's economy tins grown steadily at
about 5%, a year in real terms over the past decade. In
1972, GNP was roughly $2 billion, or about $210 per
capita. Prospect's for continued growth are good,
particularly lit mining. manufacturing, and transpor-
tation. In recent years, Portugal has placed greater
emphasis on economic development of Lite state. The
Third Six -Year Development Plan (1968 -73), funded
by Portuguese, state, and private investment, calls for
growth in GNP of 77o a year and an aggregate
investment of $586 million. Investment tinder the plan
covers major projects only and does not include sniall-
scale industry or agriculture.
Living standards of Mozambique's 27o European
population contrast sharply with those of its 98
black majority. The Europeans occupy most of the
managerial, technical, acid professional positions in
the economy, and their living standards are roui;llly
�camparable to those of metropolitan Portugal. The
blacks are mainly subsistence farmers tied to local
market areas or care unskilled and semiskilled workers
in the more urbanized manufacturing, mining, and
transportation sectors. About 250,000 of Moiant-
bique's blacks work in the mines or on the farms of
'For diauitkx on pluee mimes see the list of nantcs oti the apron
1st" the sommar; 11 ,101) in ttic Country f AASIe chapter, the map itself,
and math In (lie text.
77777777777 7777
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South Africa and Rhodesia. Laving; standards among
the blacks are roughly comparable to those of the
majority of the inhabitants of sub Saharan Africa.
Portugal is a relatively poor country as compared
with other Western European countries, and its
maintenance of a 30,000 -man defense force in
Mozambique is especially burdensome, constraining
its ability to foster economic progress in Mozambique.
B. Structure of the economy
1. Agriculture, fisheries, and forestry (U /OU)
a. Soils and climate
About twice the size of California, iNozurtibique is
1,220 miles long; and varies in width from 50 to 718
miles, The state can be roughly divided into three
geographic zones: lite coastal belt, the central plateau,
and the highlands. The coastal belt, which covers
about 4050 of the total area, is quite narrow in the
north but widens until it includes most of the country
south of Beira. The central plateau, covering 30% (if
the total area, is a transitional zo:.e of hills and low
plateaus ranging from 500 to 2,000 feet in elevation.
The Lighlund region, which has an average elevation
of 3,000 feet, extends across most of the northern p;lrt
of the country, but it becomes only a narrow strip
along the horeler in tits south. The Zambezi, southern
Africa's fourth longest river, divides Mo'ranibique in
half.
Climate varies from tropical to subtropical in all
:areas except the high platcat: and mountainous areas.
The rainy season, extending; from October to March, is
well defined and is wurmer than the dry season.
ltainfull is irregular, and sonic districts, particularly in
the south, are subject to severe droughts and floods,
ll;ainfall often exceeds 40 inches a year in the north
and normally exceeds 20 inclics in all parts of the
country. Soils throughout Mozambique are generally
poor and sandy, although rich alluvial soils are located
in the many river valleys_ Almost one -third of
Nlorambiquc's land area is suitable for crop
production, but only about 6 is actually f armland
and only 256 of the land is cultivated (Figure 1).
b. Agricealture
Mozambique is heavily dependent on agriculture,
which provides about 657c of its exports and employs
more than 80% of its population largely in
i subsistence agriculture. Most of rite foreign exchange
is derived from exports of cotton and cashews, which
are harvested by Africans from wild trees, Sugar and
tea are also valuable export crops. Sisal and copra are
TOTAL LAND ARIBA
303.769 square, miles
Fcresu 5fi;.
Cutttvated land l7.
FIGURE Estimated land use (U /OU)
exported, hilt their prices have declined sharply in
world markets. About half of [lie agricultural exports
go to Portugal. The United States, the United
Kingdom. and South Africa are also important
customers. Agricultural commodities, mainly wine
and wheal. account for about 20% of Nlozainhigtie's
imports.
Agriculture is of three types: African subsistence
farming, small- and rneditum- scale European -type
and large -scale plantation or estate farming,
Over I million African farm families are engaged in
traditional agriculture:, producing mainly cassava,
corm, peanuts, rice, and a variety of vegetables and
fruits for subsistence; most of them also grow crops for
the market economy, and they produce the hulk of the
commercial ciltom and rice. Their share of the
commercial crop output has been decrcasing,
however, because of the growth of plantation farming;,
increasing numbers of non African fanners, mud
i extension and educational services About
half of the farmland is cmtrolled by individuals cif
European extraction, who constitute less than 156 of
rile Kenn population.
Of [lie more than 3,000 rurapean- owned farms,
15% are cilropany estates and plantations, about a
dozen of which are very large. Sugar, sisal, copra, tea,
and eaoshew nuts are the prineipal plantation crops.
Small -scale E in opean farmers produce; rice, tea,
tobacco, corn, and kenaf.
The government has formulated elaborate plans to
increase agricultural production through irrigation
-told settlement schemes and through plantation and
"outgroweF' projects, Of (lie $82.1 million cannarked
a
2
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C
'Y
for agricultural development under the third
development plan, $63.6 million i. scheduled for the
development of irrigation and settlement schemes.
The plan calls for financing the settlement of about
4,000 metropolitan Portuguese farming families in
Mozambique during 1968 -73. (At present about 300
such families arc entering Mozambique each year.)
The schemes, patterned after Portuguese peasant
communities, encourage small- and medium -seals
production of livestock and such crops as rice, tobacco,
corn, and kenaf. Each settler is provided with a house,
land, tools, seeds, and other basic items. Government
expenditures total about $10,000 per family, and in
return, the state receives one -sixth of the produce from
each farm. The projects also include cooperatives,
which market the crops and provide a variety of other
services. The largest settlement programs are Iocated
around irrigation projects on the Limpopo River and
on the Revue River near Vila Pery, but current
emphasis is on colonies at Lioma in'lambezia, Vila de
Montepuez in Cabo Delgado, and Mandimba in
Niassa. De5pitc the emphasis given to these settlement
schemes, their return on investment has been quite
low. Less costly than settlement schemes, outgrowcr'
projects consist of independently owned and operated
farms situated around a processing facility. The farms
supply produce to the processing plant, .which in turn
provides technical and financial assistance to the
farms,
(1) Cashew nuts Mozambique is by for the world's
leading producer of cashew nuts, with o .tput of about
185,000 tons in 1972 (Figure 2). Exports of cashew
nuts, valued more than $35 million in 1971, are the
Ieading commodity export. Originally brought from
Brazil in the 16th and 17th centuries, cashew trees now
grow wild in the dense forests along the Mozambique
coast (Figure 3). The bulk of the crop is still gathered
by Africans from wild trees and sold through country
cs.
,11. taw
A-
dr
LIU us.
yap td
k rw
a c..r
rr sr
w
cw,a, a.
4KF."
Seats masx c.Jw nm Ca
w
Wrqugs
be" S15
FIGURE 3. Major crop areas and fishing ports (U /OU)
stores to Indian traders and to cashew shelling plants.
The cultivation of cashew trees on Europe owned
plantations has been increasing in recent years.
Prior to the raid- 1960's, almost all of the cashew
crop was sent to India for shelling and eventual
reexport, mostly to th e United States. Modern cashew
,shelling plants 110w mechanically shell a sizable
portion of the nuts prior to export. Cashew kernels are
used domestically as food, and the fruit is used in the
production of a fermented beverage. Cashew nut shell
oil, which is used in paints, varnishes, resins, and
FIGURE 2. EstimoWl production of major cash crops (U /OU)
(Thousand metric tons)
na Vats not available.
*Includes small ameunte of refined sugar.
3
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1901 -05
.1972
(AV ERAOX)
1966
1067
1808
1909
1970
1971
(mr.)
Cotton lint.........
35
38
45
42
43
46
26
na
Raw sugar`..........
169
176
204
214
250
280
325
305
Cashew nuts.........
110
160
170
120
115
150
182
185
Copra
56
55
57
00
54
60
62
no
Sisal
30
31
31
32
30
28
24
no
Tea (dried)
9
14
13
14
16
17
10
na
na Vats not available.
*Includes small ameunte of refined sugar.
3
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electrical insulation, is the most important byproduct
of the shelling process.
declined in importance because of low world prices.
About half of the exports, valued at $4 million in 1970,
go to Portugal.
(2) Cotton Yearly cotton output varies with local
weather conditions, averaging 35,000 to 45,000 tons of
lint a year. Cotton has traditionally been one of
Mozambique's largest foreign exchange carriers.
Exports of raw cotton were valued at $24 million in
1971. The cotton harvest in 1972 t3s estimated at
147,000 tons (seed basis). More than 600,000 African
farmers, mostly in the northern part of the country,
cultivate cotton using traditiL.nal, low -yield methods.
These farmers produce only about 40% of [lie total
crop. The rest is produced by Europeans and Africans
using mocleni methods. Prior to 1961, the farmers
worked for concessionaires and verc forced to plant
specified acreages, for which they received fixed
prices. The govcrnment- operated Cotton Institute
replaced this system and now markets the crop and
provides technical assistance to the farmers.
(3) Sugar Production of raw sugar has more than
doubled between 1966 and 1972, and sugar has
become an irnportar,t foreign exchange eamcr, with
exports totaling $21 million in 1971. Sugar milling
capacity has been increased to about 395,000 tons.
Domestic consumption is about 120,000 tons; the
balance of tile output is exported to Portugal. Five
large estates dominate sugar production. The ?argest is
the British -owned Sena Sugar Esta!es W., located
near the mouth of the Zambezi River. The four other
large estates� Sociedode Agricola do Incon:ati,
Acucare!ra de Mocambique, Marracrrene Agricola
Acucareira, and Companhfa do ftzl �are Portuguese
owned. New investments by Acucarefm ae Mocam-
bique to increase its annual production by 200,000
tons, plus slight annual increases forecast for the other
companies, are expected to boost Mozambique's sugar
production to about 600,000 tons by I976.
(4) Tea Mozambique ranks third (after Kenya and
Malawi) among African producers of tea. Most of the
crop, a standard- quality Indian type similar to other
cast African tc�+, is grown in the Zambezia hills and
mountains close to the Malawi border. Exports,
valued at $1v million in 1971, go mainly to the United
Kingdom. Although the government encourages
small -scale Portuguese farmers to cultivate tea, the
bulk of the production comes from large plantations
that employ over 40,000 African workers.
(6) Copra Large European -owned plantations
along the coastal plain in Zambezia and Mocambique
Districts produce mast of Mozambique's commercial
e.�opra. Smaller farmers also produce copra for their
own use. Increased domestic consumption of coconut
oil has reduced copra exports, which totaled about $9
million in 1971.
(7) Other crops �Corn is produced both on
European owned plantations and by native Africans.
Most of the crop is consumed domestically,
particularly in the south. Supplementary imports of
corn are often required, but in good years some exports
are possible. Africans grow most of Mozambique's rick
on a subsistence basis, although 4,000 to 5,000 tons
were to be exported in 1972. Peanuts are grown by
Africans throughout Mocambique, with production
averaging about 75,000 tons of shelled nuts annually.
Most of the crop is consumed locally, but sonic peanut
oil and cake are exported to Portugal. About 6,009
tons of kenaf, a substitute for jute, are produced
annually for use mainly by the local weaving industry.
Tobacco has been grown in Mozambique singe the
1920's, Marketing problems have limited exports, and
production is largely for the domestic market. Cassava
and yams are other important African subsistence
crops. Mozambique has a continuing shortage of
wheat; production is about 10,000 tons a year, and
imports total a;:out 100,000 to 110,000 tons annually.
Production of major fond crops is summarized in
Figure 4.
(8) Livestock �The raising of livestock has been
limited by the presence of the tsetse fly in over two
thirds of the country, water shortages, a lack of natural
pasturage, an unsatisfactory grading system, and the
African tradition of .holding cattle as a form of wealth.
African farmers own most of the livestt zk, but a few
large European cattle ranches around L.ourenco
Marques provide that city with meat and dairy
products. Meat production totaled only 16,500 tons in
1972.
In recent years the government has made significant
efforts to increase the livestock population, largely
through the Mozambique Veterinuiy Services
Department, which is responsible for livestock
development. The department has been giving free
technical assistance, increasing the number of
watering points, broadening credit facilities, and
seeking new markets. Through the Livestock
Development Fund, the government guarantees a
(5) Sisal �Most of the sisal is grown on large
plantations scattered along the coast in Mocambique
and Zambezia Districts. Production averaged about
30,000 tons a year during the last decade, but the crop
F
Y
i 4
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FIGURE A. Estimated production of major food crops (t110U)
(Thousand metric tons)
1061 -05
(AVERAGE) 1900 1067 1968 1969 1970 1971
Camava 2,030 2,040 2,050 2,000 2,100 2,100 2,100
Corn 361 500 800 560 500 350 410
}tics........... 94 100 100 130 150 110 160
Sweet potatoes and yams...... 31 31 32 32 32 32 33
wheat. 0 8 7 10 10 10 to
minimum price to farmers for livestock and subsidizes
the ecst of animals bought by poorer farmers. In
September 1972 the government introduced excise
taxes on certain dairy products, the procceds.of which
were to be used by the development fund to provide
banuses for improving quality and productivity, help
build milking and reduce transport and delivery
costs of dairy ,products. The gradual increase in the
livestock population is shown in Figure 5.
c. Fisheries
Despite Mozambique's long coastline and extensive
river network, fishing remains a small industry that
does not meet even the domestic demarirl for fishery
products. AlthougF some shrimp are exported, tic
bulk of the catch, estimated at 10,000 tons in 1971, is
consumed locally. Imports of fresh and dried fish,
valued at about $4 million, are the third ranking food
import, after wine and wheat.
A number of companies are involved in Mozam-
bique's commercial fishing. Our Lady of Fatima Fish
Company (INOS), a subsidiary of the South African
Anglo American Corporation, is the largest fishery
company. It was forced to transfer part of its capital to
Portuguese interests in 1966, when a law was passed
allowing only. Portuguese companies operating
Portz uese, -built vessels to fish in Mozambique
territorial waters. In 1966, Portuguese and Angolan
capitalists formed the other large fishing company,
FIGORE 5. Livestock population, (UJOUI
(IAA head)
1062 1064 1860 1969 1970
i
Cattle.......... 1,142 1,144 1,208 1,260 1,338
(bate.......... 418 419 490 1522 670
Shoop........... 100 143: 120 118 180
Hop........... 82 130 140 00 210
TotaN.....:. 1 1,797, 1,958 2,029 2,360
�Figurtt: may not add to totals becsaae of rounding.
Mozambique Fish Canning Company .(ARPEM).
Fishing; employs more than 20,000 people, mostly
Africans working for the Portuguese.
d. Forestry
Although more than half of the country is forested.
only 10% of Mazarnbiquc's total area has commer-
cially exploitable forests. The state owns almost all the
forests and issues licenses to concessionaires for their
exploitation. Licensing is designed to avoid
indiscriminate cutting and to protect certain species.
Domestic consumption of wood chiefly for
carpentry and for use as charcoal and fuelwood for
cooking --is very small. About 90% of production,
which consists entirely of hardwoods, is exported.
Exports of wood products, valued at $7 million, were
the country's seventh most valuable export in 1971.
2. Tuels and power (C)
Mozambique's energy resources include a hydro-
electric potential that is sufficient to meet the
economy's need fa: many years, fuelwood for the
subsistence sector, and coal for both domestic use and
export. Several companies hold concessions for oil
exploration, but after investments of over $50 million,
no oil was found and drilling ceased. Leserves of
natural gas, estimated at over 3 billion cubic meters,
have been discovered at Pande. South Africa offers a
potential market for the gas, but its exportation would
require construction of a 250 -mile pipeline, and this
doec noz seem feasible in the near future:
The refinery at Matola -Rio fills almost all domestic
needs for petroleum products through the processing
of imported crude. The refinery, owned by National
Petroleum Refinery Company (SONAREP), has a
capacity of 18,000..barrels perday(b:p.d:). In 1971, its
output averaged 14,500 b.p.d. with a value of $26
million for the year. Imported crude petroleum �all
from Iraq, and Imni was vitlued:.at :$1W million in
1971. Except for :some highly specialized Octrolcum
products, the iefinery,'s output exceeds -domestic
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requirements. About two- thirds of the output is
exported, primarily to South Africa, Malawi,
Swaziland, and Portugal. This refinery is to be
i expanded, and the building of another, much larger,
refinery at Nacala to provide additional exports is
being considered.
Mozambique- Rhodesia Pipeline Company, a joint
British, Portuguese, and Rhodesian firm, completed a
petroleum pipeline from Beira to Rhodesia's Feruka
refinery in 1965. Almost 200 miles long, it has a
throughput capacity of 2.1,000 b.p.d. of crude oil. The
pipeline has never been used because of the U.N.
embargo on oil shipments to Rhodesia.
The small clCctric power industry meets the
demands of the major cities, although in the last
decade there has been virtually no increase in
generating capacity. Upon completion of the first
three stages of the Cabora Bassa hydroelectric
powerplant in 1979, however, Mozambique will rank
third on the continent of Africa in installed power
capacity. At the end of 1971, estimated installed
capacity was 232,000 kilowatts (kw.). Electric power
production In 1.971 was approximately 550 million
kilowatt hours (kw.- hr.) -68 kw.-hr. per capita --or
about 25% of capacity.
Although about 705' of the national power capacity
is in thermal installations, the largest single facility is
the 64,900 -kw. Revue hydroelectric powerplant,
which contains almost 30% of Mozambique's total
capacity. In addition to supplying power to Vila Pery
and to Beira, 140 million kv. -hrs. are exported
annually from Revue to Umtaii in Rhodesia. In
Lourenco Marques the National Company for the
Study and Financing of Ovarseas Undertakings
(SONS E) has thermal (steam) renerators with a total
capacity of 37,500 kw, and a 17,500 -kw, reserve gas
turbine plant. A new 36,600 -1 gas turbine unit o is
scheduled for completion bathe end of 1973. Smaller
Plants form an important component of the electric
j power base by supplying remote localities and isolated
industries.
The electricity transmission s)stem consists of 1f0-
kilovolta(kv.) and 66 -kv. lines. The main transmission
system serves the Lourenco Marques and Beira areas.
A 275 -kv. transmission line links the SUNEFE and
South African power networks. A 22 -kv. distribution
system and lower voltage lines provide power to
several tmvzrs. CGnsumer current k 1- and 3- phase, 50
cycles, at 220/3M0 volts.
Power development focuses on construction of the
Cabora..Bassa dam, lrtcated 86 miles from Tete on the
Zambezi River. The project, for which it contract has
been awarded to an international consortium, is
designed to provide abundant and inexpensive
electricity to Mozambique and South Africa. It will
also serve as the cornerstone of a plan for agricultural,
mineral, and industrial development in the
surrounding region. South Africa has agreed to
purchase most of tltc initial output of electricity,
because Mozambique's present needs are small.
Revenue from the sale of electricity during the first 15
years will be used to repay foreign loans used to
finance the dam. Thereafter, foreign exchange
earnings of at least $25 million annually will accrue to
Mozambique.
The first stage of the project, scheduled for
completion in early 1975, consists of the installation of
generators with a capacity of 1.2 million kw., the main
darn, and a portion of the South Bank Powerplant.
The second stage will increase the capacity to 1.6
million kw. in 1977, and the third stage will further
raise it to 2 million kw. in 1979. The final phase, not
yet tendered for bids, would provide a total capacity
of 4 willion kw., nearly twice that of the Aswan l-Iigh
Darn, currently the largest in Africa.
Two parallel, 830 -mile powcrlines will link thedam
with the Republic of South Africa. Militant black
African nationalists have attempted to block the
construction of the powerplant and dam. An
underground coaxial cable is being installed along the
entire 850 -mile route as an atixiliary in the event of
disruption of the surface lines, In sections of the
transmission line route, unfavorable terrain, including
mountainous areas, makes construction, maintenance.
and defense of transmission facilities especially
difficult. Guerrilla harassment could lead to Icngthy
dclays in construction. Construction has also
reportedly begun on the long awaited hydroelectric/
river control clam at Massingir on a tributary of the
Limpopo River that is to be the focal point of a large-
scale Limpopo valley development program.
3. Metals and minerals (1U/01U)
Mozambique has an extensive variety of mineral
resources, but their exploitation has been limited by
inadequate transportation facilities and generally low
ore concentrations: Mineral production was valued at
less than $7 million in 1971. Mozambique is divided
into three main areas of mineral .wealth: the Vila de
Manica area near Vila Pe-y. an extension of the
Rhodesian mineral zone; Tete District; and an area
extending north from Quelimane to Porto Amelia and
tip the Cabo Delgado District to Tanzania. The
Zambezi River valley iu District containing iron
ore, tantalite, fluorite, and extensive coal deposits ---is
the most promising area for mineral exploitation.
`6
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r
C'
Other important iron ore deposits -e at Vita Per) near
the Rhodesian border and at Narnapa near the coast.
Pegmatite deposits containing beryl, und coluntbite-
tantalite, are locate(1 near Alto Ligonlia, and copper
deposits are found in the Vila Pery District. Deposits 7)f
nickel, ilnlenite, manganese, uranium, asbestos, gold,
and diamonds occur throughout the country.
Coal is by far the largest item in Mozambique's
limited mineral production. The Mozambique Coal
Company extracts 300,000 tons of coal a year from the
Vila Muutize coalfields, most of which is sold to local
railroads and the remainder is exported; production
has been limited by high transportation costs.
Production of colurnbitc- tantalite, which i'I used as an
alloy in heat resistant metals, has declined in the last
I0 years and was valued at only $600,000 in 1971.
Small quantities of other minerals arc mined (Figure
6).
Prospecis are good for Increased iron. reproduction.
The Sumitomo Group of Japan plans to develop iron
ore deposits near Namapa estimated at 360 million
tons. The project includes t}re construction of a
railroad to the port of NadNala for transporting the ore.
Tile Uranium Company of Mozambique will exploit
the other large iron ore deposit near Vila Pery, which
contains all estimated 100 million tons of high -grade
ore. Plans call for the construction of a 250,000 ton
per -year steel mill in Lourenco Mar(tues, to be
complete([ in 1973 -76, that will utilize domestic iron
ore and scrap iron.
Mott minerals, except for coal and iron ore, are
exploited by small private mining operations.
Government policy calls for improving the inspa :ion
of concessionary enterprises in order to reduce
uneconomic exploitation. Construe'don of the Calory
Massa dam will facilitate the exploitation of the
Zambezi valley's considerable mineral wealth.
Aglioiif of U.S. Donors
Food
4. Manufacturing and construction (U /OU)
Mozambique's pridustriai sector has expanded
rapidly in the last decade and now accounts for about
20% of GNP. Industrial production reached $120
million in 1971, a 9% increase over that of the
preceding year. In the first half of 1972 production
FIGURE d, Production of principal minerals (UJOU)
(Metric forts)
1960 I965 1071
c
Coal 280,020 237,500 322,073
Columbite- tantalite........ 152 31 8o
2%ficrolite ti 85 54
Bau%I 4,840 5,0so 5,515
ao rs� and
tobkco
'Potraleum
Products
Chemical
products
Mineral
products
Meg[ products
Shoes and
dothiag
Wood products
FIGURE 7. Output of major manufacturing industries,
1971 (UJOU)
increased 12 o over the corresponding period of 19; I.
Europeans own and operate most of the plants and
employ Africans as unskilled laborcrs.
Industrial activity consists hargely of agricirlttual
processing and consumer goods production Figure 7).
Food processing accounts for the largest portion of
industrial output. Sugar refining, the processing of
cashew nuts, and the milling; of rice and wheat ..re
prominent industries. Soft drinks anti beer are the
main beverages produced. Other major manufacturjd
items include cotton and jute textiles, petroleum
products (from imported erurl� oil), vegetable oils, and
cement. Other manufactures, produced 1.irgely for
local consumption, inclwe cigarettes, 1- 1tles, tin
cans, paint, soap, metal furniture, and lottery, in
addition, l)icycics, refrigerators, and radios are
assembled, and there is some metalwork, incit,ding the
manufacture of railway cars for local arse and export.
Government policies that discourage imports and
encourage local investment in order to promote
industrial development are [raving some success. In
addition to older industries, such as textiles and food
processing, new ventures are expanding in such fields
as chemicals, pulp and paper, storage batteries, rubber
tires, and various types of machinery and equipment
assembly fir mid -1972, 1.50 applications, representing
a total investment of $140 million, were pending for
the establishment or expansion of industrial projects.
The major centers of industrial development to date
have been in L,ourenco Marques and Be!.m (Figure S).
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I
FIGURE 8. Major industrial and mining cutters (l1{OU)
Local production supplies light construction
:materials. Hardwoods are abundant, and there are
large sawmills it, the Beira and Lourenco Marques
Districts. Granite and other hard rock are available in
the north, and limesto! -a, sand, and gravel exist in
most areas. Cement, lime, precast concrete products,
asbestos, bricks, and tiles are manufactured lomtily.
Cement production has risen rapidly in recent years,
totaling 420,900 tons in 1971. A new cement plant
under construction at Matola -Rio will have an annual
capacity of 600,000 .tons. There is no basic steel
industry, but steel reinforcing bars, wire, and wire
products are produced from scrap and imported
materials. Manufacturers in the principal,, towns
produce a narrow range of structural steel, sheet
metal, and foundry castings. Asphalt, paint, welding
electrodes, industrial gases, electri c cable, and cordage
atso are made locally. Government engineering
departments and contractors increasingly are using
carth- moving and general civil engineering equip-
ment, much of which has been imported for
development projects such a: the Cabom Bassa dam.
There are good workshop facilities in'the principal
towns.
5. Domestic trade (U /OU)
Mozambique's comrnercia) system is oriented more
to the transit trade serving its landlocked neighbors
than to purely domestic trade. Most railroads and
E3
roads extend from east to west, linking the developed
areas of the interior countries with the coast. Those
transportation facilities tht k serve Mozambique
exclusively are inadequate and have hindered the
expansion of domestic commercial activity. A major
effort is now underway. however, to Iink the main
population and industrial centers through a
comprehensive system of hard surfaced roads and
improved air transport. The first north south asphalt
road from Lourenco Marques to Beira is now
complete, as is an asphalt road from Vila Pery to Tete
and Cabors Bassa. New feeder roads and rail links are
also planned, Mozambique will be linked to Luanda
(Angola) and Lisbon by a daily jet service when the
international airport at Lourenco Marques is
expanded and modern,zed (by June 1973).
Trade in the modem sector of the economy has
grown along with the expansion of r.NP and is
centered in the urban areus; Lourenco Marques alone
accounts for about half of gross sales. The gross
commercial sales index for Lourenco Marq!ies
increased from 219 in 1969 to 25 &in 1970 and 295 in
1971 (1959=100). New consumption taxes and
customs clearance charges have hampered trade
growth, as have restrictions on imports of consumer
goods. Europeans awn the large import- export houses
and also control most domestic trade. Indians and
Chinese operate many of the general merehandisz
stores and trading houses.
Most of Mozambicans live in,, rural areas, where
trade is carried on through barter. There iE some
commerce between Africans and European rural
merchants, who purchase livestock, cashew nuts, and
other farm products. The government is expanding the
monetary sector by establishing more than a thousand
trading posts throughout the country for the benefit of
the local population. In addition, cooperatives and
commodity boards provide advice to Africans on the
marketing of their own goods.
C. Economic policy and development
(U /00
1. Policy
a. Government finance
Portugal maintains close control of Mozambique's
finances through inspection and annual review of
accounts by the Ministry of Overseas and the National
Assembly. Annual budgets must be submitted to tl
Legislative Assembly for approval. Mozambique has
two budgets-. the ordinary budget covers recurring
items, and the extraordinary budget deals chiefly with
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O Q Cw+f11�'tMU.
l ip
Crw Mrwrw7 W.
L I L 4 lwMq m/Mi.vKk
I.I nA
FIGURE 8. Major industrial and mining cutters (l1{OU)
Local production supplies light construction
:materials. Hardwoods are abundant, and there are
large sawmills it, the Beira and Lourenco Marques
Districts. Granite and other hard rock are available in
the north, and limesto! -a, sand, and gravel exist in
most areas. Cement, lime, precast concrete products,
asbestos, bricks, and tiles are manufactured lomtily.
Cement production has risen rapidly in recent years,
totaling 420,900 tons in 1971. A new cement plant
under construction at Matola -Rio will have an annual
capacity of 600,000 .tons. There is no basic steel
industry, but steel reinforcing bars, wire, and wire
products are produced from scrap and imported
materials. Manufacturers in the principal,, towns
produce a narrow range of structural steel, sheet
metal, and foundry castings. Asphalt, paint, welding
electrodes, industrial gases, electri c cable, and cordage
atso are made locally. Government engineering
departments and contractors increasingly are using
carth- moving and general civil engineering equip-
ment, much of which has been imported for
development projects such a: the Cabom Bassa dam.
There are good workshop facilities in'the principal
towns.
5. Domestic trade (U /OU)
Mozambique's comrnercia) system is oriented more
to the transit trade serving its landlocked neighbors
than to purely domestic trade. Most railroads and
E3
roads extend from east to west, linking the developed
areas of the interior countries with the coast. Those
transportation facilities tht k serve Mozambique
exclusively are inadequate and have hindered the
expansion of domestic commercial activity. A major
effort is now underway. however, to Iink the main
population and industrial centers through a
comprehensive system of hard surfaced roads and
improved air transport. The first north south asphalt
road from Lourenco Marques to Beira is now
complete, as is an asphalt road from Vila Pery to Tete
and Cabors Bassa. New feeder roads and rail links are
also planned, Mozambique will be linked to Luanda
(Angola) and Lisbon by a daily jet service when the
international airport at Lourenco Marques is
expanded and modern,zed (by June 1973).
Trade in the modem sector of the economy has
grown along with the expansion of r.NP and is
centered in the urban areus; Lourenco Marques alone
accounts for about half of gross sales. The gross
commercial sales index for Lourenco Marq!ies
increased from 219 in 1969 to 25 &in 1970 and 295 in
1971 (1959=100). New consumption taxes and
customs clearance charges have hampered trade
growth, as have restrictions on imports of consumer
goods. Europeans awn the large import- export houses
and also control most domestic trade. Indians and
Chinese operate many of the general merehandisz
stores and trading houses.
Most of Mozambicans live in,, rural areas, where
trade is carried on through barter. There iE some
commerce between Africans and European rural
merchants, who purchase livestock, cashew nuts, and
other farm products. The government is expanding the
monetary sector by establishing more than a thousand
trading posts throughout the country for the benefit of
the local population. In addition, cooperatives and
commodity boards provide advice to Africans on the
marketing of their own goods.
C. Economic policy and development
(U /00
1. Policy
a. Government finance
Portugal maintains close control of Mozambique's
finances through inspection and annual review of
accounts by the Ministry of Overseas and the National
Assembly. Annual budgets must be submitted to tl
Legislative Assembly for approval. Mozambique has
two budgets-. the ordinary budget covers recurring
items, and the extraordinary budget deals chiefly with
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X
FIGURE 9. State gove.nment budget, 19$8 -1972 IUJO.UI
(Millions of U.S. dollars)
1971 1972
1968 1969 1970 (rm.) (zaT.)
O rdinary revenue I... 251 281 366 288 315
Di rect taxes
Indirect taxes
EXCESS taxes
Other taxw
Receipts of autonomous agencies and funds.......
Other
Extraordinary
T otal revenue
OrdW,-,y expenditure
Debt servicing
D ovelopnicnt
D efense.
G onerat a dministnstion
Oth er
Extmordlaary expenditure
39
47
59
48
55
34
&5
40
37
40
17
24
20
28
26
14
13
19
18
18
134
146
137
142
in
12
13
13
16
14%
26
33
36
43
69
270
314
342
331
3"
239
264
290
288
315
11
12
14
19
21
113
124
132
115
128
29
32
33
15
38
44
48
57
02
69
41
48
54
58
59
26
34
36
43
6P
T otal expendituro* 205 208 326 331 am
Surplus 11 17 i8 0 0
*Figures may not add to totals because or rounding.
nonrecurring items such as public development
financed the deficit. Minost 80% of the extraordinary
expenditures. Deficits in the ordinary budget are
expenditure in 1970 was for financing the third
prohibited, but the state may use all revenues
development plan.
collected from domestic sources to meet expenditures
in that budget. Deficits art permitted in domestic
b. Money and banking
financing of the extraordinary budget, which are
Mozambique is it member of the escudo monetary
balancert by loans from Portugal.
zone, which is composed of Portugal and its overseas
Ordinary budget revenues and expenditures
territories. Each members escudo currency is on a
increased stctldily during the last 5 .years (Figure 9
par �but not intcrchangcablc --with those of others.
Actual revenues and expenditures for 1971 and 1972
Discount procedures usuall: reduce the buying power
are �probably greater than those shown, since budget
of the Territorial currencies relative to that of Portugal.
forecasts are,usually underestimated. About half of the
annual ordinary budget revenue comes from
The Overseas National Bank (BNU) acts as
t- awned enterprises, particularly ularly the
panti
governmen railroads-
Mozambique's central bank and issues the Mozam-
and.the ports administration. Indirect taxes,
bique escudo. The early 1973 exchange rate was
including' excise taxes, iire. the second most important
UMl 27.25 escudos.
source of;' income: Direct taxes, such as the ,head tax
Moza mbique makes payments to other territories of
and taxes on individual acid exyrpnrate incomes,
the escudo zone either directly 'through commercial
provide= less than 2096 ;of the'.` total. Uevelapment
ban ks ar 4hrnugh special reserve accounts maintained
expenditures accounted for about `4050 of. the iotul
fiie cuch overseas statc b'y the Bank of Portugal, the
estimated ordinary expenditures during 1972..';
reserve brink for the escudo zone. Payments wes subject
Extraordinary; receipts an expenditures more than..
ta.Service- ,'charges: Payments between :Mozambique
doubled between:1068 and 1972'Bli lrrr l uses,`
and fo reign countries are arriade either throu
coircge..profits, and sale o b onus provided
authorized lilnks in Mozambique or through the
extraordinary rcoetpts,"- and loans' from Portugal
intcrteriiiorial cleuring,systcrn..
7
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The BNU provides most of the commercial banking
services in Mozambique. ire 1971, the BNU accounted
for over half of the bank loans outstanding. There are
four other commercial baarls: Commercial Bank of
Angola, Commercial and Industrial Credit [lank,
Ping and Sotto Mayor Bank, and Standard Totta
Bank of Mozambique. Specialized institutions include
a mutual savings bank and a cooperative bank.
Two banks provide development loans. The
N;;tionul Developincnt Bank (BFN), a Portuguese
government agency, provides long -term loans for
selected major projects. Except for foreign investment,
almost all financing for private enterprises conies from
the BFN. The Mozambique Credit Institute provides
short- and medium -term loans and guarantees for
Ixrth private and government borrowers. Covernment
agencies must deposit their funds in the institute,
which in 1972absorbcd the Mozambique Agricultural
Credit Bank.
2. Development
Portugal formulates Mozambique's long -term
development programs as part of a Man for the entire
escudo zone. The initial long-term program was tiee
First Six Year National Development Plan (1953 58).
investments mainly in the transportation and
agricultural sectors� totaled about $ay million under
that plan. Almost all funds to support lice plan curie
from within Mozambique. Under the Second Six -Year
Development Plan (1959.64) grants and leans from
Portugal accounted for about half of the development
expenditures, which rose to $125 million. In the Three
Year Transitional' Program (1965 -67), expenditures
increased to $186 million; Portugal, the domestic
private sector, and private foreign investors provided
funds in about equal amounts, This program gave top
priority to tiee development of transportation and
harbor facilities and also stressed increased
agricultural and industrial production.
The Third SixrYrar Development Plan (1968.73)
called fora E 50trrriii }I growth rate in GDP and
envisioned tc tai investments of $586 million.
Covernment ',9tri c{ in this plan focused on
infmstructtir+e aiiti agriculture. About two thirds of the
investment was to come from internal sources �obe-
third from the Mozambican and Portuguese
administrations and one -third from the private sector.
Priva foreign sources were scheduled to prmiide the
remaining one third. lot addition,, investments of over
$300 million -not included lee tiee development
plan- will be made during constriction of the giant
Cabora Basso dam. Work on the first stage of the dum,
one of the largest in the wor'.d is on schedule for the
10
1975 completion date. External loans and expo,t
credits are to provi&the necessary financing.
Under a new program announced in 1972, the
governor General promulgated a Fonr -Year Govern-
mental action Plan (1972 -75) to tape advantage of the
greater aulonomy now accorded W7:utnhiclue. "floe
plan calls for un annual growth rate of 1010 ire GDP,
but this goal will be difficult to iacet.
Until recently, Portugal exercised tight government
control over llte operation of private enterprises, .tied
there wus little foreign investment. At lice present
time, howc;ver, Parttegucse policy favors foreign
investment lei Mozambique. Opportunities are likely
to be greater when foreign firms enter in association
with Portuguese or Mozambican firms, liberal tax
concessions and other benefits are available, especially
for investments that provide import substitutes or
increase exports. 'There ;ire few restrictions oa
repatriation of profits or capital. Nevertheless,
political uncertainties and the effects of government
efforts to improve the balance of payments will
continue to hamper growth in investments.
3. Manpower
Only 10:0 to 15% of Mozambique's population are
w->egc earners. Almost all sectors of the economy suffer
from a shortage of skilled and semiskilled manpower.
Unemployment and underemployment are serious
problems among tioskilled laborers who have been
migrating to the cities from rural areas. Mozambique
has begun an ambitious now program to expand
vocational training and establish official employment
agencies. In ade. Lion, it is attempting to increase work
incentives by improving social services available to
workers and by raising wages. Immigration of high
level mWipow'er and technicians is also encouraged.
Black Africans hold all inferior position in the labor
market. Although government and marry private
employers ostensibly hire with little or no racial
discrimination, black workers are usually relegated to
lower level jobs by their lack of training and
experience compared to unnblacks. Except for teachers
and "nurses, the professions are almost devoid of blacks,
as are the upper echelons of the civil service. Black
Africans are increasingly being trained for, and are
obtaining, better jobs in both the industrial and public
sectors, but the numbers are still small. In the past as
many as 400,000 blacks a,. year worked ire South Africa
or Rhodesia, but this number has been reduced
sharply by improved working conditions and salaries
in Mozambique and by adverse conditions in
Rhodesia since its unilateral declaration of
independence. The annual remittance from these
workers currently does not exceed tie of GNP.
77 7
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't +,'.e a Ce f r`... ,k...e ro ;saz +wh_fi -.,R N
n a. s.. s., u...z ,..e:: .s...,..aa ti..- ..a3;.::;^�ti.a... -.i. w....'a'w:.n.�v7...w
M
Although a spirit of entrepreneurship is found
among small -scale artisans, there is a shortage of local
people willing and able to innovate in medium scale
enterprises. This is due in part to a lack of capital and
of sources of loans. Except within a small number of
white- dominated corporate ventures in commercial
agriculture, mining, industry, and transportation,
experience in organizing and operating large -scale
business is also lacking. The shortage of entreprenetirs
and the dependence of the economy oil efficient
operation of the transportations sector have stimulated
thegovernment to assume responsibilities in thisarea.
Certain categories of workers �such as office
workers, construction workers, and truck drivers --are
organi7xd into syndicates or labor unions. Member-
ship is small because of the educational anci skill
requirements, as well as the lack of power of the
unions. The unions are state controlled, and although
they may negotiate inerea-tied benefits for their
members, they may not strike. Politically, the labor
force is passive and apathetic, and there has been little
important labor unrest in recent years. The only labor
groups displaying any militancy are the dockworkers
and stevedores, who have mounted a few short -term
wildcat strikes, demonstrations, and slowdowns.
D. International economic relations
(U /DU)
1. Foreign trade
Mozambique is heavily dependent on foreign tmde.
Imports supply most capital goods and a variety of
consumer `goods, while much of the domestic
agricultural and industrial output is exported. Imports
have consistently exceeded exports, and the trade
deficit has increased considerably in recent years
(Figure 10).
The value of all imports increased by more than
one -third from 1968 to 1970, but slackened in IN as
the result of tightened restrictions favoring imports for
development. Textiles wem the principal consumer
goods imported in 1971, valued at $z7 million. Other
major imparts consisted of consumer goods and
products required for developing infrastructure and
industry. In 1971, nearly half of such development
imports consisted cif metals and metal products,
transportation materials, and machinen and electrical
equipment.
Agriculture provides most of Mozambique's exports,
the most important of which am cashews, cotton,
sugar, tea, .copra, refitted petroleum, and timber
3s�
boo
2%
269
l5a
100
56
FIGURE 10. Extemal trade, 1961-71 M O W
(Figure I1). In 1971, cashews, cotton, and sugar
accoult;ed for almost half of all exports. Cashews have
shown the largest increase in capnrt value because they
are now shelled prior to shipment. Prospects for
increased mineral exports are good. Coal. columbite-
tantalite, and microlitc are noiv the principal mineral
exports.
Portugal is Mozambique's most important trading
partner, taking 37% of its exports and providing 269
of its imports in 397) (Figuxe- 12). Cotton and sugar
are the most important exports to Portugal.
The United States and South Africa are also major
trading partners. Cashews, valued at $ly million in
1971, are by far the leading export to the United
FIGURE 11. Majay exports (UJOU)
(Millions of U.S. dollars)
10 1968 1970 1971
Total
V13
4162
8165
$169
Of which:
Cashews............
22
30
32
38
C otton
20
2S
30
23
Sugar
17
Is
21
21
Tea................
9
11
8
10
Copra
9
I3
13
9
Tim3er
6
6
7
7
1?uel oil...........,
na
no
4
6
W Data not available.
11
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Millions of u.s, Donors

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IMPORTS
U5 ;154 Million
Pc,cenl
Other
Id,a Portvgat
15 South Atria
West Germiey
United Kin=dom
s� 47; United saes
'a`,7 _;Z1 Iraq
consumption to essential products, and encourage and
protect local industries. Total exchangr authorizations
are limited by a global ceiling, which is fixed by the
level of exchange receipts, In 1 &73 impart quotas were
made !wiversal by the removal of the distinction
between imports from within and without the escudo
zone Except for protected products such as wine and
olive oil, goods from Portugal no longer enjoy a
preference over goods from other parts of the world.
All imports are subject to a surcharge of 5 and
additional import taxes are levied on certain luxury
it ems.
Mozambique benefits indirectly from Portugal's
membership in the International Monetary Fund
(IMF), the European Free Trade Association
the International Bank for Reconstruction and
Development (IBRD), the Gcnervi Agreement on
Tariffs and Trade (GATT), and U.N. economic
organizations.
2. Balance of payments
FIGURE 12. Diredion of trade, 1971 NJOW
States. U.S. exports to Mozambique in 1971 included
aviation equipment and parts ($7A million), tractors
I ($1.8 million), and wheat ($1.8 million). South Africa
imports agricultural and refined petroleum products
t from Mozambique and, agricultural
corrmoditics and iron acid steel products.
Mozambique's. imports are authorized on the basis
of a system 'of priorities set by Lisbon. The priorities
are designed to:. encourage investment; limit
S:3
Net earnings from invisibles, mostly from the transit
trade, have only partially offset annual trade deficits
(on a settlement basis; Figure 13). Receipts for transit
services are the largest source of invisible earnings,
traditioitally supplying one-fourth to one-third of total
earnings. In 1971 the trade deficit (settlement basis)
narrowed slightly as [lie rate of growth in imports
declined, while net rr ^eipts from invisibles increased
almost 20% above 1910, causing a substantial
reduction in the current account deficit. Total reserves
rose from $13.6 million at the end of 1970 to $24.8
million at the end of 1971. The rerouting of Zambian
trade from Mozambique ports to Tan7ania folio-wing
a dispute with Rhodesia in January 1973 threatens to
significantly reduce transport revenues.
Mozambique normally records large deficits in its
commodity trade with Portugal, causing increasing
arrears in payments to Portugal, A comparison of
balance of payments and trade data consequently
shows discrepancies because the timing of settlements
is very different front the timing of trade flows. ily Iate
1971 the delay in settling payments to Portugal was
510 days, and by the end of the year the accumulated
backlog of payments was $146 million. If the
payments to Portugal bad been made when they were
due, the deficit in the balance of payments would
have reached $98:5 million in 1970 and X39.6 million
in 1971,
3. Foreign aid
Mozambique depends on Portugal for external
financial assistance, which consists largely of loans for
a2
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LM
FIGURE 13. balance of payments (t1JOU)
(AWHons of U.S. 611ors)
Current imnsactions I
Merchandise
Invisible s..............................
Of which;
Tourism
Transportation.....................
Capital returns
c apital transactions
Shorttcrm
M edium and long term...
Personal
Overall balaneco
19139
1900
1970
1071
4.1
-39.1
-47.7
-24.6
-67.0
-10819
-138.9
-133.4
71.1
60.7
91.2
108.8
(3.5)
(3.5)
(6.9)
(3.7)
(641.7)
(67.2)
(60.8)
($2.9)
-14.2)
(-11.0)
-16.1)
-5.3)
-15.3
-5.9
-7.4
9.1
-4.5
1.5
5.1
15.4
-10.7
-7.4
-12.5
-515
0
0
0
-0.8
11.21.
-45.I
-55.1
-15.5
�sllahtnce -or- payments statistics are shown on it svttlement basis and do not reflect arrears in pay.
ments to Portugal. Totals may not add becalm of rounding.
N
L
development. About $75 million was to have been
provided for the 1968 -73 develupment plan. Official
loans from Porttlgal balance the extraordinary budget,
which reflects largely expenditures to finance the
development plan. lit recent years these loans, which
totaled $6 million in 1970, provided 15% to 1 -Wi of
extrraotdinary receipts. In uddition, Portugal extends
Movamhigiw lorig -terin loans for major projects
through the National Oct- clopmerrl, Bank suid
guarantees investinents f rom Portugiiesr. and foreign
sourcrs.
Ca:s I nisviri,u.. 13'
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