by Samantha James

Boom in coal industry

Mozambique's infrastructure will experience growth in the coming years due to an increase in coal mining

Infrastructure set to grow in Mozambique in the next decade due to an increase in coal mining
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The sudden boom in coal mining industry is driving infrastructure development in the country, with the transport and energy and power infrastructure sectors set to experience the greatest growth over the next decade.

New analysis from Frost & Sullivan (http://www.environmental.frost.com <http://www.frost.com/prod/servlet/svcg.pag/EVEV African Infrastructure Tracker: Mozambique’s Infrastructure Sectors, finds that there are nearly 60 multi-million dollar ongoing infrastructure projects in the country, of which ten are multi-billion dollar projects. Transport, energy and power, telecommunications, water and, social infrastructure will see an investment of approximately $34 billion.

“Several coal mines are being developed in the Tete Province of Mozambique,” noted Frost & Sullivan’s Environmental and Building Technologies Industry Analyst, Sarah O’Carroll. “Improved logistics infrastructure for raw material exportation will be necessary to make these mines successful and competitive.”

The mining industry is also energy-intensive. Currently, mines are expected to meet their own energy demands through the use of diesel generators. However Mozambique is already engaged in several capacity building projects in the energy and power sector to meet projected increases in demand.

The transport sector will benefit from investment to the value of $22.41 billion over the next decade. Investments in the roads sector will see the reconstruction of a number of trunk roads that were destroyed during the civil war, as well as the development of the Nacala,  and Maputo corridors.

Investments in the rail sector will be used to expand the rail network – currently a single railway corridor – to facilitate exports from Tete. Many ports are also undergoing significant expansion projects so that the country’s export capacity will increase fivefold.

“The government’s reliance on donor funding is the single most significant challenge restraining infrastructure development in the country,” cautioned O’Carroll. “However, the private sector is currently supporting 65.6 percent of all infrastructure projects in Mozambique, thus stimulating infrastructure development in the country.”

Mining companies, in particular, account for 17.1% of all infrastructure investments, ensuring that infrastructure is sufficient to support their coal exports.

“Companies that have been in the market for several years, can demonstrate their ability to overcome challenges, as well as work within a specified budget and deliver projects timely have the greatest advantage in winning tenders in Mozambique,” advised O’Carroll. “Here, it is not only price, but quality and service that are equally important.”

If you are interested in more information on this study, please send an e-mail with your contact details to Samantha James, Corporate Communications, at samantha.james@frost.com <mailto:samantha.james@frost.com>. 

African Infrastructure Tracker: Mozambique’s Infrastructure Sectors is part of the Environmental Growth Partnership Service programme, which also includes research in the following markets: Kenya's Infrastructure Sectors,Uganda's Infrastructure Sectors, Tanzania’s Infrastructure Sectors and Namibia’s Infrastructure Sectors.

All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. All research included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

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