MAPUTO)– Mozambique’s second largest commercial bank, the Commercial and Investment Bank (BCI), has announced the launch of a line of credit of 500 million meticais (about 8.5 million US dollars) to finance small, micro and medium-sized enterprises (SMMEs) involved in agro-businesses.

The announcement was made at a seminar held by the Confederation of Mozambican Business Associations (CTA) on Tuesday, the second day of the Maputo International Trade Fair (FACIM), being held at Ricatla, in Marracuene district, about 30 kilometres north of the capital.

We are continuing to re-affirm our position in the market, by giving our support in this way to the micro, small and medium enterprises which are active in agro-business, declared BCI representative Casimiro Chichava. This line could contribute to supporting investment with loans at very competitive interest rates and attractive repayment periods.”

Mozambique’s agricultural sector currently employs around 5.7 million people, which is about 70 per cent of the economically active population. In 2017, agriculture contributed 29 per cent of the gross domestic product.

However, farmers are only using a small fraction of the available arable land and more than 85 per cent of the arable land is not used for agriculture. Most agricultural production is undertaken by smallholder farmers who face enormous difficulties in obtaining bank credit. Indeed, in recent years the financing for agriculture has fallen.

The BCI says that in this context it is taking up the challenge of transforming agriculture into a more competitive and sustainable sector of the economy, so that it can continue to constitute the largest source of income for the Mozambican population.

The bank is also calling for a range of reforms to stimulate agricultural competitiveness, and for such programmes as the provision of school meals which are based on local agricultural production. The BCI also urges producers to adopt an image and packaging strategy to make their products attractive, inside and outside the country.