Mozambique: Business Complain about Trade Barriers

Maputo — Mozambican businesspeople are complaining about tariff barriers in the trade of some products with the neighbouring Malawi, despite an existing bilateral trade agreement that effectively removes all tax barriers between the two countries.

According to Tuesday's issue of the daily paper "Noticias", the processing companies are complaining against a ten percent tax imposed on the export of wheat flour, which they consider an unfair treatment for products manufactured in Mozambique.

It is in this context, that representatives from both countries are to meet in Malawi next month, to reassess the implementation of trade under the bilateral agreement in force since 2001.

Malawi is one of the 14 member countries from the Southern Africa Development Community (SADC), but is to join the region's Free Trade Area, which came into force last year.

Therefore, trade between Mozambique and Malawi is made through bilateral agreements. This is a more flexible tool compared to the SADC Trade Protocol, especially regarding certification of origin.

The issue of the of 10 percent tax on wheat flour manufactured in Mozambique was one of the matters discussed by a technical meetings held during the recent three-day official visit of the Malawian President, Bingo Wa Mutharika to Mozambique.

No major developments came from the meeting due to lack of evidence on discrimination of Mozambican products exported to that neighbouring country.

Therefore, both parties agreed to meet again next month, this time in Malawi, where the parties will also will discuss a proposal made by the Malawian for the expansion of export products to be exempted from taxes in the trade between the two countries.

The range of products proposed by the Malawians for exemption include packaging, such as cement bags, paper packaging and cardboard boxes, among others for export.

'To that end we have to work together with Mozambican companies to identify those manufacturing these packaging materials and those who import from Malawi, to find out if the reasons are price related. All these elements must be brought to the negotiation table for discussion, because we must give an answer to Malawi", said Cerina Banu, Director of International Relations at the Ministry of Industry and Commerce.

Banu, who speaking on the sidelines of a meeting involving businesspeople from the milling industry in Mozambique, representatives from the Mozambique Tax Revenue Authority and from the Industry and Commerce Ministry, she added that the meeting in Malawi would cover other trade related issues, especially the movement of goods from one country to the other.