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Poverty pinches Mozambique’s soaring economy

Mozambique's economy is growing fast, investments are rising and it has won praise for governance reforms. But poverty is never far away.

In southern Gaza province, 180 kilometres from Mozambique's capital Maputo, lies the paradise village of Bilene, overlooking the Indian Ocean. On a four km stretch of exquisite prime beachfront, the South-African firm Dubai World Africa is investing U$ 200 million for a luxury beach resort, golf estate and eco development. It spans a surface area of 40km and encompasses beautiful blue water lagoons surrounded by expensive two to three storey houses whose owners only come once a year for the festive season.

Not far from this paradise is a falling-down reed hut ridden by termites. It belongs to Niaase Matusse who was born just a generation before the Second World War, a time when Mozambique was still under Portuguese colonial domination.

Eating wild leaves

In her 81 years she has seen the heartache and the hope, the armed struggle and the recent progress. But she is still poor and the pangs of poverty will accompany her to her last day. "I thought you were bringing me some food because I haven't eaten in the past few days. I'm just boiling these wild leaves to sustain my stomach until this evening" she said as she broke into tears.

Inside the hut, there are two very old pots. One of them is on her 'stove', which is secured by three stones, with wet wood piled under it. It is dark inside the hut because of the smoke but it is possible to see another old and rusted plate in the corner with some wild leaves. These leaves are her food. The only new thing in her falling-down hut is a carefully conserved voter's card, wrapped in plastic.

In Mozambique, poverty is clearly visible and hunger is an everyday reality. The World Food Programme has just warned that 11 provinces and a quarter of a million people in the country face acute food shortages and despite recent economic gains, the economy is still recovering from years of civil war.

For us there is nothing

Sergio Alfredo also lives in Bilene. He is 28, unemployed and feeds his family of three children with the little money he earns from small-scale fishing activities. The luxury resort development, a symbol of Mozambique's growing economy means little to him. "I have heard about these ambitious [tourism] investment projects but for us here this is nothing because we will not be employed since we are not educated, there are no schools and many children cannot get to a nearby school which is 100km away from here. They prefer to go fishing," he said. "I would have loved to do anything different, but I have no choice. We have these tourism resorts here but we are not employed simply because we don't speak English. Farming is also bad because of a long drought."

It can be hard to reconcile these encounters with the fact that Mozambique's economic and social performance is above average for Sub-Saharan Africa. The former Portuguese colony, which was one of the poorest in the world at the end of a 17-year civil war in 1992, has enjoyed rapid growth over the past decade. The country is popular with institutional and bilateral donors. Its economy expanded by 6.7 per cent in the first half of 2008 with forecasts still optimistic despite the global downturn.

In 1997, the government launched its first anti-poverty initiative, the Absolute Poverty Reduction Action Plan (PARPA). It saw the incidence of poverty (defined as living on one US dollar a day or less and lacking access to health, education and other services) decrease from 69 per cent to 54 per cent by 2003.

Post-war gains skewed

However, the gains of post-war economic growth are highly skewed, with limited economic development taking place in rural areas, particularly in the northern and central provinces. As a result, chronic poverty is common beyond the industrial hubs of Maputo, Sofala and Nampula provinces. The bulk of the country's youth are illiterate, hopeless and see their future floating in uncertainty.

Other mega projects such as the US$1.3 billion aluminium smelter project led by BHP Billiton in Maputo, the gas project headed by South Africa's petrochemical giant, Sasol, in the southern Inhambane province and refinery in the northern Nampula province will have little direct impact on the lives of many Mozambican youth like Sergio Alfredo because they do not have the skills for most of the jobs on offer. These jobs are most likely to be taken by foreign expatriates.

Education and skills, as Sergio Alfredo pointed out, are the key to getting such plum jobs. But illiteracy in Mozambique is as high as 72 per cent, and on average girls only remain in school for three years and boys only for four years. This is particularly so in rural areas where 74 per cent of the country's 20 million people live.

Low expectations of young

In Chibuto, in Gaza province, lies a US$500 million heavy minerals project run by the international company Corridor Sands. But many people living there, particularly the youth, know little about the project. "I'm not employed and I don't know anything about this project, I'm just 24 years old. I feed my three children and wife with the money I get from buying and selling tomatoes," said Virgilio Cambaco who lives a few kilometres away from the plant. "We have not been told what that project is all about, we only see people from outside this village coming to work there and going," he said.

After the country's independence in 1975 Mozambique immediately plunged into a crippling war. As a result, school infrastructure is generally run down, underdeveloped or non-existent. Many children learn in dilapidated buildings or in the open air, without basic facilities like desks.

Nor are expectations always high. A 24-year-old mother of three, Hortencia Mbombi, said that she would rather die poor than walk for long distances and sit under a tree for education. Referring to the attainments of the current Mozambican prime minister, Luisa Diogo, she added, "That woman was just lucky and even if I want to go to school, my husband will not let me go."

Ambitious government plans

On the positive side, public expenditure on education has steadily risen since the war, with donor support supplementing the small gains emanating from decelerated national debt servicing.

The government of President Armando Guebuza hopes to achieve the United Nations backed Millennium Development Goals of cutting poverty by half in 2015. The UN believes Mozambique is on track for meeting one of the key targets of the MDGs due to sound economic growth driven by foreign investment.

In its latest report it says, at the current rate of poverty reduction, the number of people living below the poverty line will fall from the 2003 figure of 54.1 per cent to 45 per cent in 2009, and to 40 per cent by 2015.

However, the level of investment in the education sector remains comparatively weak in the face of overwhelming demand. This sustains a vicious cycle which means that despite its impressive macro-economic growth figures, there are still few jobs available in the booming industries for ordinary Mozambicans.

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