Economy of Zambezia Province, Mozambique

Summary

Zambezia province holds significant economic potential, driven by its agricultural base, natural resources, and strategic location. Investments in agriculture, infrastructure, tourism, and sustainable forestry can transform the province into a key economic hub. However, addressing poverty, infrastructure deficits, and climate vulnerability is crucial for inclusive and sustainable growth. With support from international partners like the World Bank and MCC, and proactive government policies, Zambezia can leverage its resources to improve living standards and contribute to Mozambique's broader economic development.

Economic Overview

Zambezia province, situated in central Mozambique, is the country's second most populous region, with a population exceeding 5.11 million as of the 2017 census. Covering approximately 103,478 square kilometers, it features diverse landscapes, including lush forests, extensive river valleys, and a picturesque Indian Ocean coastline. The Zambezi River, one of Africa's longest, flows through the province, emptying into the Indian Ocean. Quelimane, the provincial capital, serves as a vital commercial hub with a rich history of trade. Bordered by Nampula and Niassa to the north, Sofala to the south, Malawi and Tete to the west, and the Indian Ocean to the east, Zambezia plays a significant role in Mozambique's economic landscape.

Major Industries

Zambezia's economy is predominantly agricultural, with smallholder farms and large enterprises contributing significantly to both local and national markets. In 2005, cassava was the most widely harvested crop, covering 466,360 hectares and generating a production value of Intl $265.74 million (Data Africa). Other key crops include rice, maize, beans, and vegetables, with tea noted for its high production value per hectare (Intl $2.16k/ha). The province also supports fishing, particularly shrimp, and gemstone mining, though these sectors are less dominant. Tourism potential exists due to the province's natural beauty, including beaches and wildlife reserves, but it remains underdeveloped.

Economic Indicators

Specific GDP data for Zambezia is scarce, as most economic statistics are reported at the national level. Mozambique's GDP grew by an estimated 5.0% in 2023, driven by extractive industries and services . Zambezia likely contributes to this growth through agriculture, but its per capita income is low, reflecting widespread poverty. As of 2008, 3.34 million people in Zambezia lived below $1.90/day, and 3.88 million below $3.10/day (Data Africa). The 2019/2020 Family Budget Survey reported that 70% of Zambezia's over 6 million inhabitants face high poverty levels, with 60% lacking access to basic sanitation .

Infrastructure

Infrastructure deficits are a major constraint. Only 15% of households had electricity access in 2018, and less than 30% had access to safe water in 2015 (U.S. Census Bureau). Transportation relies on Quelimane Airport for domestic flights and a road network, with Quelimane approximately 1,500 kilometers from Maputo. Recent investments, such as the MCC's $537 million compact for rural infrastructure and agriculture, aim to improve connectivity.

Employment and Labor Market

Agriculture employs the majority of Zambezia's workforce, primarily in rain-fed subsistence farming. Limited formal employment opportunities contribute to poverty, with many households relying on informal activities. 

Poverty and Inequality

Zambezia's poverty rate of 70% is among the highest in Mozambique, exacerbated by limited access to education, health, and sanitation. Inequality is significant, with economic growth often benefiting larger enterprises rather than smallholder farmers. The province accounted for a substantial share of Mozambique's poor in 2009, alongside Nampula .

Investment Opportunities

Zambezia offers several avenues for economic growth, supported by government and international initiatives:

Agriculture

With fertile soils and a tropical to sub-tropical climate, Zambezia is a prime candidate for agricultural investment. The province produces significant quantities of cassava, rice, maize, and other crops. The government has identified 15 strategic value chains, including poultry, meat, and vegetables, with potential for export and import substitution (APIEX Mozambique). World Bank-funded irrigation projects, such as the $90 million Sustainable Irrigation Development Project, have enhanced productivity in Zambezia. Poultry projects also show promise, with initiatives aimed at benefiting local communities.

Infrastructure

Infrastructure development is a priority, with significant investments underway. The MCC's $537 million compact focuses on rural roads and transportation in Zambezia, improving market access for farmers . World Bank projects, including a $150 million grant for water supply and sanitation in Zambezia and Nampula, address critical service gaps . The proposed Alto Malema hydroelectric facility could boost energy access .

Tourism

Zambezia's natural assets, including its coastline, and wildlife reserves like the Zambezia National Reserve, offer untapped tourism potential. Beaches such as Zaiala and cultural attractions like Zambezi-style cuisine could attract visitors (Mozambique High Commission). Developing tourism infrastructure could create jobs and diversify the economy.

Natural Resources

Zambezia has gemstone deposits and significant forestry resources. Sustainable forestry initiatives, supported by World Bank payments for reducing deforestation, have earned Mozambique $6.4 million since 2019 (World Bank). The Mocuba Industrial Free Zone, established in 2014, aims to attract investment for export-oriented industries (AllAfrica).

Challenges

Poverty and Inequality

High poverty and inequality limit economic inclusivity. Policies to redistribute resources and improve access to services are critical, as highlighted by the National Institute of Statistics (Club of Mozambique).

Infrastructure Deficits

Limited electricity, water, and sanitation access hampers productivity. Continued investment in infrastructure is essential to support economic growth.

Climate Vulnerability

Zambezia is highly vulnerable to climate shocks, with frequent floods and droughts affecting agriculture. A 2015 flooding event in Mocuba underscored these risks (ResearchGate). Climate-resilient practices are needed to safeguard livelihoods.

Security

While less severe than in northern provinces, security concerns could deter investment. Stable governance and community engagement are vital.

Government Policies and Development Plans

The Mozambican government promotes investment through the Agency for the Promotion of Investment and Exports (APIEX), offering tax and customs incentives (APIEX Mozambique). Zambezia benefits from a Special Economic Zone (SEZ) with tax exemptions for goods produced in the zone (U.S. State Department). The First International Investment Conference in Zambezia, held in Mocuba, aimed to attract investment to strategic sectors (Club of Mozambique).