The World Bank has approved a $300 million credit for the Mozambique Access to Finance and Economic Opportunities Project or Mais Oportunidades project.
The project directly supports the Government of Mozambique’s reform initiative, Pacote de Medidas de Aceleração Económica (PAE), including through the creation of a national Credit Guarantee Fund.
The project which spans six years (2023-2029), is financed by the International Development Association (IDA).
Idah Z. Pswarayi-Riddihough, World Bank Country Director for Mozambique, Madagascar, Mauritius, Comoros, and Seychelles said:
The World Bank will support the Government of Mozambique to address multiple economic shocks and market constraints that prevent micro, small, and medium enterprises (MSMEs) and individuals, including informal workers, from accessing and using financial services and taking advantage of economic opportunities.
The National Credit Guarantee Fund is meant to help banks have more money available to lend to small businesses, especially those owned by women and operating in regions or sectors that are affected by climate change. It will also promote economic growth by improving the business environment, expanding market access, and offering training and financing.
The project is expected to help create over 26,000 new jobs over six years.
The combination of credit guarantees and lines of credit aims to mobilize up to $450 million in private-sector loans to MSMEs across the country through partner financial institutions.
In addition, the project will promote financial inclusion by linking members of informal savings groups with formal financial institutions to promote sound resource management and resilience to shocks, particularly for women-owned or led businesses.
Generating enough jobs, particularly green and productive jobs, is a critical challenge for Mozambique.