Mozambique

Mozambique's reform of its customs operations was initiated in a difficult postconflict environment, which was characterized by a substantial disruption of government services. The approach chosen was unique in that it relied heavily on outside contractors to manage customs services for some time while preparing national authorities to assume full responsibility for them. This experience contains useful lessons for other customs organizations that face similar circumstances.

Background

Mozambique is located in southern Africa and has borders with Malawi, South Africa, Swaziland, Tanzania, Zambia, and Zimbabwe. It has a population of 18.1 million and a total surface area of 489,192 square miles, with 2,841 miles of land borders and 1,535 miles of coastline.

Regional and Preferential Trading Arrangements

Mozambique is a member of the Southern African Development Community (SADC) and of the Cross-Border Initiative. Under the SADC trade protocol, many goods exported from Mozambique, largely raw materials, are exempt from duties in other SADC member countries. Mozambique has signed a preferential trade agreement with South Africa and is currently negotiating bilateral trade agreements with Algeria, Cuba, Egypt, India, Kenya, Malawi, Mauritius, Russia, Zambia, and Zimbabwe. Mozambique's exports enjoy preferential access to the European Union market (under the Cotonou Agreement) and to the markets of industrial countries in general through the Generalized System of Preferences. In addition, Mozambique's exports are eligible for duty-free import into the United States for commodities that qualify for the Africa Growth Opportunity Act. Mozambique is also a member of the World Trade Organization (WTO) and the World Customs Organization (WCO), and it has signed many of the agreements and declarations of those organizations.1

Economic Reform Program

After Mozambique achieved independence in 1975, its economy contracted severely during the next 10 years because of civil war and because of inadequate economic policies. In 1987, the government launched its Economic Rehabilitation Program with the support of the International Monetary Fund (IMF), the World Bank, and bilateral donors. The major reforms undertaken under the Economic Rehabilitation Program include (a) unifying and stabilizing the exchange rate, (b) eliminating most price controls, (c) privatizing public enterprises, (d) introducing extensive financial sector reforms, and (e) undertaking significant tariff reform and trade liberalization. Mozambique has made impressive economic gains under the program. During 1987-97, real gross domestic product and exports grew, on average, by 6.8 percent and 15.6 percent, respectively. However, Mozambique remains a relatively poor country-its gross per capita income was US$210 in 2001-with social indicators that are below average for countries in Sub-Saharan Africa.

A key component in the overall process of economic reform was the 1995 decision by the minister of planning and finance to reform and modernize the customs service, primarily to improve the government's revenue-raising capacities and to control trade and transit flows better. The key featu...

If you are already a vLex customer, Access Here