Future Proofing Cities

Mozambique - Growth Corridors Foreword

It is a great pleasure to introduce these Future-Proofing Cities Studies, covering cities in Ethiopia, Ghana, Mozambique and Uganda. These studies, form an integral part of the Future Cities Africa (FCA) Programme that the Cities Alliance has undertaken over the past two years, with financial support of DFID. These studies covered nine cities that were carefully selected to represent metropolitan cities, secondary cities, regional capitals and cities within growth corridors. Together, they exemplify the challenges of contemporary rapid urban growth, and the opportunities and promise that African cities can and must hold for the future of the continent.

While demonstrating important differences between the cities, there is a common thread that is well understood by national governments and city managers alike: a combination of enabling national policies, strong institutions, well-resourced and accountable local governments, and informed and engaged citizens are essential for local and national prosperity. On the African continent it is precisely these type of cities, in every country, that will have to be empowered to contribute to the successful implementation of Agenda 2030, and grapple with the consequences of climate change. However, time is very short, as the majority of urban growth is determined more by facts on the ground than by effective policy-making.

I would like to thank Jamie Simpson, Erika Puspa and the entire FCA team for their outstanding work in completing a complex work programme against demanding deadlines, our colleagues at Arup International Development for the high quality of these studies, and Simon Ratcliffe and his colleagues at DFID (UK) for their constant support and encouragement.

William Cobbett Cities Alliance Director

Mozambique - Growth Corridors is part of the Future Cities Africa (FCA) initiative in partnership with Cities Alliance and the UK Department for International Development (DFID).

FCA is a partnership initiative launched by Cities Alliance and DFID to support cities in Ghana, Ethiopia, Uganda and Mozambique as they transform themselves into resilient, inclusive centres of economic growth.

© Arup, 2016

Unless specified, all images are copyright Cities Alliance or Arup Acknowledgements

This report has been developed by Arup in collaboration with Cities Alliance as part of Department for International Development’s Future Cities Africa programme. We would like to thank the Future Cities Africa team and the wide range of stakeholders we consulted in Mozambique for making time to contribute to this study. Also, we wish to recognise the valuable guidance and feedback we’ve received from the Cities Alliance team on our findings and how best to communicate them.

Jo da Silva Director Arup International Development

On behalf of Arup International Development’s study team: Jose M. Ahumada, Kieran Birtill, Andrew Charles, Jo da Silva, Belinda Hewitt, Ripin Kalra, Braulio Eduardo Morera, Siddharth Nadkarny, Samantha Stratton-Short, James Waters

Graphic design: Mark Doyle

Contents

Introduction...... 2 Approach...... 5

Mozambique...... 7 Growth corridors...... 11 Tete...... 17 Nampula...... 33 Nacala...... 45 Final Thoughts...... 57

Appendix...... 61 Information mapping...... 62 Low-carbon initiatives...... 63 References...... 65 Future Proofing Cities | Growth Corridors in Mozambique

African governments are counting on urbanisation to lift their nations out of poverty.

Figure 1. Port of Maputo Credit: Julien Lagarde / Flickr

1 Future Proofing Cities | Growth Corridors in Mozambique

Introduction

The majority of Africa’s population will shift from rural to urban in the next thirty years. Future Cities Africa aims to help cities achieve inclusive economic growth, manage demographic change, and address environmental risks.

Africa is going through an economic exclusively in Africa and Asia, boom and cities are at the centre representing over 90% of the of this pathway to economic world’s urban population growth prosperity. The boom in trade and (WEF, 2015). In its recent report, “The emerging future of industry is being defined by two key Future of African Cities: Poles of cities largely depends features that are set to alter Africa’s Prosperity or Slums of Despair future: a youthful population and (2015), the Brenthurst Foundation on the way we plan and urbanisation. Combined, these indicates that by mid-2030 half manage urbanization, and features will drive modernisation of all Africans will live in cities. the way we leverage this and increase connectivity across the They suggest that three main transformative process to continent (KPMG, 2012). drivers of African urbanisation are ‘provide the setting, the fuelling these historic changes in Africa’s cities are emerging as the continent: natural population underlying base and also centres of entrepreneurship, growth, rural-urban migration, the momentum for global innovation, creativity and invention. and large-scale dynamics such change” Africa is now the fastest-growing as connectivity, technology region in the world in terms of and globalisation (Brenthurst Joan Clos mobile telephone and internet Foundation, 2015). Linked to these access. It is anticipated that mobile drivers of growth, greenhouse gas Executive Director UN-Habitat data usage will increase twenty emissions in the region are expected times between 2013 and 2019 to grow rapidly, primarily through (Ericsson, 2014). Africa is also increased fossil fuel use, and the final inhabited continent on agricultural expansion (Hogarth et the planet to urbanise. Globally, al, 2015). future city growth will be almost

75 or over 50 to 75 25 to 50 Less than 25 1950 2014 2050 (projection) Figure 2. Percentage of the population residing in urban areas. Credit: World Urbanization Prospects, The 2014 Revision. UN 2015.

2 Future Proofing Cities | Growth Corridors in Mozambique

African city megatrends Development megatrends impacting African cities can be viewed as opportunities or risks depending on a city’s context.

Figure 3: African city megatrends - highlighting Mozambican megatrends based on Z-punkt, n.d. & Arup Cities Alive, 2014

3 Future Proofing Cities | Growth Corridors in Mozambique

The challenge facing African Currently, 36% of Mozambique’s cities is to provide their citizens population lives in urban areas. with equal economic opportunities This number is increasing in part while transitioning to a low carbon due to the country’s blistering GDP economy, using limited resources growth rate – this has been as high efficiently, and managing rapid as 15.3%, in the first quarter of 2004 urban and population growth. (Tradingeconomics, 2016). Roughly African cities also need to manage 90% of the typical Mozambican city the impacts of a youthful population. is made up of informal settlements. In Uganda, for example, the With projected urban growth rates of majority population is younger than 3% each year, cities in Mozambique 15. This leads African leaders to are becoming denser, particularly “The current wave of urban question whether their demographic in unplanned settlements (Cities growth in Africa is faster profile is an economic godsend or Alliance, 2015a). and occurring faster and on ticking time-bomb (World Bank, 2012). The report also discusses the impact a larger scale than anything of the urbanisation strategy on the world has yet witnessed, For African cities to be successful the regional development of the and therefore poses the they should adopt integrated and country through the promotion holistic urban planning practices of growth corridors. To discuss greatest challenge yet for that consider not only inclusive this message, Future Cities Africa urban and national policy- economic development and low- has selected three cities along the makers” carbon development pathways but Nacala Corridor - Tete, Nampula, also the environmental and social and Nacala - to explore current Brenthurst Foundation, 2015 impacts of growth to promote urbanisation trends and to highlight liveable cities. Cities need to plan key challenges these cities may face for growth that is future-proofed for in the future. our changing climate, the challenges of scarce natural resources, and This report relates to urban growth underlying geophysical risks. corridors in Mozambique and represents one of four reports This report relates to urbanisation prepared for Future Cities Africa. as it is currently happening in Each report covers a specific Mozambique. It explores the country, its national urbanisation present situation of cities and the strategy and its specific regional government’s planned urbanisation planning typology. The other three strategy. It also discusses how the reports include metropolitan cities in country plans to transition to a Ghana, secondary cities in Uganda, majority urban population. and regional cities in Ethiopia.

Figure 4. New bridge in Tete. Credits: zambezitraveller.com 4 Future Proofing Cities | Growth Corridors in Mozambique

Approach

“FCA seeks to support cities in Africa to become future-proofed for climate, environment, and natural resource challenges, so that they are inclusive and resilient, and have growing economies. It will help make cities work for the urban poor. It will conduct an in-depth feasibility and scoping study and develop innovative tools to enable rapidly growing African cities to realise their potential as centres of growth and job creation; use research and evidence to develop targeted urban action plans.” Future Cities Africa Business Case and Intervention Summary (DFID, 2014)

Future Cities Africa is working City Governments are trying to... with Sub-Saharan (SSA) cities to future-proof them for the Manage range of social, economic, and environmental risks they are Achieve exposed to now and will be Demographic exposed to in the future. As transition discussed above, African cities Physical & social are experiencing rapid population Inclusive growth and urbanisation alongside economic growth a range of severe environmental shocks and stresses. City Risk governments in Africa tend to Climate change Natural resources have limited institutional capacity, Geophysical over-stretched financial and human resources, and limited data to guide decision-making. Future Proof Future Cities Africa has identified three key drivers (see Figure 5) that are shaping African cities: Figure 5: Future Cities Africa drivers achieving inclusive economic growth, managing demographic change, and addressing local risks associated with climate change, These studies are part of an in-depth organisations better understand the natural resources, and geophysical feasibility and scoping phase to specific challenges each is facing. risks. develop diagnostic tools to enable these cities to realise their growth Two tools are used as part of our Arup was asked to prepare Future- potential and begin to guide this data analysis to help us dig-deeper Proofing City Studies for nine growth toward a more resilient and into the capacity to act and risks cities in four countries: Mekele and inclusive future. We hope that these in the cities - the Cities Alliance Dire Dawa (Ethiopia); Accra and city studies will help practitioners Normative Framework and the Arup Tema (Ghana); Tete, Nampula, and in local municipalities, national Environmental Risk Framework. Nacala (Mozambique); and Jinja administrations, and international and Arua (Uganda).

5 Future Proofing Cities | Growth Corridors in Mozambique

Normative Framework Urban ER

NABLING ENVIR Drivers of risk CAL E ONM YSI EN PH T Local Regional Global

SER VICES NMENT RO k ENVI

P E I I C

ONO SH N FCA M ZE program I Y T entry-point I C Biological & Natural resource risk GOVERNANCE Dimensions of environmental ris

IN T ST EN ITU M TIO IRON Geophysical Risk NAL ENABLING ENV

Figure 6: Normative Framework Figure 7: Urban ER framework

The Normative Framework describes the physical Arup has developed an Urban Environmental Risk and institutional environment which can support Framework (Urban ER) in order to help cities to cities to achieve inclusive economic growth, to understand and address the critical environmental manage demographic change and to future-proof challenges which shape urban wellbeing. The against environmental risks. The Framework helps: Framework identifies three dimensions of identify relevant data sources, facilitate discussions environmental risk for African cities: climatic, and build understanding of the factors that African biological, and natural resource and geophysical cities need to ‘get right’ to achieve inclusive growth, hazards. A current risk rating is provided through an manage demographic change, and address future risk. understanding of existing threats. A future risk rating The Framework is a tool to assess the physical and is provided based on the drivers of risk at three scales: institutional enabling environment within African local (such as loss of local biodiversity), regional cities, and provides an evidence base for future (such as poor regional planning policy), and global planning, investment and decision-making. As part (such as climate change). Through understanding of this work, the Framework mapped the available the drivers of environmental risk, we can help city information for each city and to provide an holistic governments, advisors and stakeholders understand understanding of each city’s assets according to the how local urban development pathways can create five dimensions of the Framework. or compound risk. Urban ER can also help cities evaluate their capacity to act at different levels in order to mitigate current risk, and collaborate with others on a local, regional and global level to achieve a more resilient future.

6 Future Proofing Cities | Growth Corridors in Mozambique

Mozambique 7 in 10

Mozambique’s rapid economic growth since 1994 has been accompanied by renewed national focus on economic development policies centred around urban residents urban areas. live in informal settlements Mozambique, in Southern Africa, Mozambique was first settled is a young, vibrant and optimistic between the 1st and 5th centuries nation of 24m people with great by Bantu-speaking peoples that economic growth potential. The migrated from West and Central discovery of large deposits of coal Africa. The people and culture have and other mineral resources in the been influenced by historical trade country have resulted in substantial routes, bringing Swahili, Omani foreign investment in mineral ore Arab, Persians, Somali and finally extraction and processing mineral. Portuguese influences to the shores The country’s location on the Indian to take advantage of valuable natural Ocean makes it southern Africa’s resources which still supports Sustained economic growth gateway to markets in Asia, the its economy to this day. Shortly On average, Mozambique has seen after gaining independence from Middle East, and Europe, while its a 7-8% annual growth in per Portugal in 1975, the country fell 1,500 km long coastline is dotted capita GDP since first democratic into a prolonged civil war which with beaches and coral reefs that elections have made it into a tourist hub (NY lasted 15 years. Following the peace Times, 2014). Given its location agreement in 1992 and democratic and low levels of cultivated farming elections in 1994, the country has land, Mozambique has vast potential seen high levels of economic growth to be a major food producer in and foreign direct investment. The Southern Africa, and to play a role country’s GDP growth has averaged in minimising food insecurity for 6.4% between 2000 and 2016 its landlocked neighbours (USAID, with staggering highs of 15.3% 2016). reached in the first quarter of 2004 (Tradingeconomics, 2016) brought about by significant levels of foreign investment.

Figure 8. Port of Maputo Credit: Julien Lagarde / Flickr 7 Future Proofing Cities | Growth Corridors in Mozambique

Mozambique at a glance

Poor housing conditions Low GDP per capita

was Mozambique’s per capita uban GDP in 2014. Only 13 other countries $600 in the world have lower per 7 capita GDPs 10 Vulnerability to sea level rise of urban residents live in informal settlements or poor % housing conditions 60 of the country’s population and 6/10 largest cities Financial dependence on central government lie on Mozambique’s coast

Informal economy

of the average of 1/2urban employment in % municipal budget Mozambique occurs in is funded through the informal sector central government 60 transfers

Figure 9. Mozambique infographic 8 Future Proofing Cities | Growth Corridors in Mozambique

Despite its record levels of growth, emerged as relatively safe zones Mozambique still ranks 180th out and saw a mass migration from of 188 countries and territories worst-affected rural areas (Emerson, on the UN Human Development 2014). While cities became oases Index (UNDP, 2016). GDP per of safety, due to the conflict, they capita in 2014 was $600 – only 13 could not provide employment, other countries in the world have resources or basic services for the lower figures (World Bank, 2016). influx of people. This resulted in In urban areas, nearly 70% of the high concentrations of poverty and population is below the poverty line informality in urban areas (Cities Continuing decentralisation (Cities Alliance, 2015a). Specific Alliance, 2015a). challenges for the nation include of power low levels of literacy (56%) and life Currently, 36% of Mozambique’s expectancy (currently 50.3 years), population is urban, spread across Since 1998, a national high rates of malnutrition and 43 municipalities. Only Maputo has decentralisation policy has enabled malaria responsible for 35% of child a population over one million and the transfer of governance powers mortality and 29% of the general 12 other cities have over 100,000 to provincial and municipal population (World Bank, 2016). residents. With Maputo and the governments second largest city, Matola, both in With the country rapidly Maputo Province, urban populations transitioning from being one of the are skewed towards the south least urbanised countries in Southern despite the overall population being Africa in 2005 to currently the concentrated in the north (38.7% fourth most urbanised, city growth of the total population lives in will be at the heart of achieving the Nampula and Zambezia provinces). country’s development plans. Cities In secondary cities in Mozambique, in Mozambique have emerged in unregulated informal settlements National policies for urban different contexts. Cities such as make up roughly 90% of the development Quelimane and Sofala are historic municipal territory. With a 3% urban ports and emerged as market towns growth rate, increasing populations for trade along the eastern coast of in Mozambican cities are increasing Through the set-up of special Africa. Similarly, cities like Chimoio densification of unplanned economic zones, industrial free and Tete were market towns near settlements (Cities Alliance, 2015a). zones and development corridors, major rivers. During Portuguese Mozambique seeks to spur colonisation, forts were built at Urban areas continue to be economic development in cities strategic, well-connected locations characterised by an extensive across the country on the coast and the hinterland, lack of infrastructure and a which led to the emergence of the majority of residents continue to administrative centres of Maputo live in poorly-serviced informal (founded in 1787) and Nampula settlements. Population growth (founded in 1907) (UCLG, n.d.). has been accompanied by a lack of Critically, during the civil war, cities investment in basic infrastructure located along the strategic road, resulting in poor urban services. railway and energy corridors such Manufacturing-based employment as Maputo, Quelimane, and Beira was decimated during the civil

9 Future Proofing Cities | Growth Corridors in Mozambique

war, and fiscal austerity measures capacity and governance skills Nearly 60% of municipal budgets accompanying funding from from the central to municipal are funded by the centrally- international organisations during government, along with the managed Municipal Compensation the 1990s has prevented state consolidation of operating Fund which constitutes less investment in the manufacturing capacity at the municipal level. than 1% of the national income. or services sector. This has The economic growth in cities is Evidence gathered in our study resulted in an urban economy led largely by exploitation and suggests that these funds are not also characterised by informality. processing of natural resources. sufficient to manage the increased Nearly 50% of all employment In the north, this is mainly around responsibilities that district and is in the informal sector (Cities minerals and coal, and in the south municipal governments have to bear. Alliance, 2015a). it is focused on manufacturing Key powers for implementation aluminium. of development plans, such as Within this context, Mozambican control over land use and titling, are cities are increasingly seen as Districts are responsible for subject to approval from the central drivers of economic growth for urban planning, with oversight ministries and parliament (Cities the country. Decentralisation from central ministries. While Alliance, 2015a). policies have been put in place municipalities are responsible to allow cities more control over for social infrastructure service the direction of their economic delivery and management, there development. Decentralisation are few independent revenue began with municipal elections in sources for these actions. 1998. The policies aim to transfer

2M

1.5M Maputo

Matola 1M

Nampula Beira 0.5M Chimoio Quelimane Nacala Mocuba Lichinga Tete

0

Figure 10: Most populated cities in Mozambique

10 Future Proofing Cities | Growth Corridors in Mozambique

Growth Corridors

National policy seeks to set up growth corridors through different parts of the country to achieve economic, human development and regional co-operation goals.

While cities are seen as drivers of Growth corridors are economic by the national government. The economic growth for Mozambique, development initiatives at the National Development Strategy their development is highly regional scale. They seek to spur of 2015 proposes development dependent on national policies regional development by connecting of corridors across the country to and programs. Mozambique has economic nodes to each other with spur development, but does not looked at a number of policy transportation and communication specify areas or regions where approaches that reinforce the central infrastructure. When successful, these are to be set up (NDS, 2014). government’s importance in spurring improved connecting infrastructure Infrastructure upgrades for the economic development, such as is able to attract investment in the Maputo corridor have been carried the formation of Special Economic regions throughout the corridor. out by setting up public-private Zones and Industrial Free Zones, This increases linkages between partnerships (Santos et al, 2015). and Development Corridors. At nodes and maximises their economic For the Beira and Nacala corridors, the same time, different models of potential (Galvez Nogales, 2014). rail infrastructure has been upgraded planning practice have emerged by mining companies who continue The planning and vision at the provincial and municipal to operate them and setting up for growth corridors across scales that seek to foster economic use agreements with the national Mozambique is derived from development locally. government for running passenger development strategies prepared rail lines (The Economist, 2016).

Evolution of a growth corridor

Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Transport Corridor Logistics Corridor Trade Corridor Economic Corridor Growth Corridor

Transport Transport infrastructure corridor Logistics corridor Trade corridor Economic corridor + + + + + Transport services Logistics Trade facilitation Other economic Human coordination dimensions development

Figure 11: Evolution of a growth corridor

based on Galvez Nogales, 2014

11 Future Proofing Cities | Growth Corridors in Mozambique

In Mozambique, growth corridors Economically integrate the have been a key policy that seeks country to achieve different strategic, economic, and social goals (NDS, Redistribute investment in different 2014) which include: regions and foster economic links between them by improving Improve rural economy infrastructure connections between major cities. Planned corridors seek Boost the agriculture and fisheries to connect industrial centres and sector by improving transportation port cities to mineral-rich provinces infrastructure between major cities, in the hinterland, which also boosts and slow migration to cities. manufacturing. Improve regional cooperation Address low financial capacity Mozambique’s economic corridors of governance extend towards landlocked The development of economic neighbouring countries and are corridors is funded by a mix of supported as Regional Spatial funding sources: private investors, Development Initiatives Programs public-private partnerships, (RSDIP) within the Southern international development agencies African Development Community and central government funding. (SADC) framework (Santos et al, 2015).

Figure 12: Train in north Mozambique Credit: Nico van der Westhuis/Flickr 12 Figure 13: Beira and Maputo corridors’ map Tanzania

Malawi

Lilongwe Zambia Nacala Nampula

Lusaka

Tete

Harare Zimbabwe

Beira

Mozambique Channel Mozambique

Maputo Johannesburg Maputo Corridor South Africa Beira Corridor

Nacala Corridor 0 100 200 300 km Future Proofing Cities | Growth Corridors in Mozambique Tanzania

Malawi Economic corridors in Mozambique

The development corridor policy has resulted in the establishment of the Maputo, Beira, and Nacala Lilongwe corridors. Of these, the Maputo and Beira corridors are well-established and illustrate the purposes of Zambia the development policy: Nacala Nampula

Lusaka

Tete Beira Corridor The Beira Corridor links the port city of Beira to landlocked Zimbabwe and Zambia through an upgraded existing railway line, while also connecting to the Harare mineral-rich province of Tete. In 2010, the Beira Agricultural Growth Corridor (BAGC) initiative Zimbabwe was launched as a partnership to co-ordinate funding from international development organisations for the Beira formation of a catalytic fund. The fund encourages the growth of responsible commercial agriculture and the Mozambique development of 10 million hectares of arable land along the corridor (Santos et al, 2015). Channel Mozambique

Maputo Corridor The Maputo Corridor links mining in the eastern provinces of South Africa to the Maputo port that was upgraded in 2003, while providing neighbouring Swaziland with a connection to the sea. This corridor is built around a rail connection and upgraded highway system on the South African and Mozambican sides of the border. Transportation upgrades were carried out through a number of public-private partnerships. The Maputo key anchor project for this corridor was a $1 billion Mozal aluminium smelting plant on the outskirts of Johannesburg Maputo (Santos et al, 2015). Consequently, other Maputo Corridor private-sector aluminium-based manufacturing has emerged along the corridor (Allafrica.com, 2016a). South Africa Beira Corridor

Nacala Corridor

14 The corridor passes through or influences most areas in Northern Tanzania Mozambique, including the densely populated Zambezia and Nampula provinces

Cabo Delgado Niassa Malawi

To Lusaka

Lilongwe Nacala Nampula Cuamba

Tete Nampula

Tete

Zambezia

An upgraded railway line starting near Tete meets a transnational highway passing through Lusaka and Lilongwe at Cuamba in Mozambique to form the corridor Mozambique Channel Road Railway

The recently upgraded Sena railway line can transport coal from Tete to Beira, but the port at Beira is insufficient to handle the volume of coal being transported

0 50 100 250 km Figure 14: Nacala corridor map Beira Future Proofing Cities | Growth Corridors in Mozambique

Nacala Corridor The third planned corridor in between Tete and Nacala presents a Mozambique’s National Mozambique is the Nacala Corridor, challenge for other sectors using the Development Strategy 2015 which is the focus of this report. corridor for growth. However, the envisions that growth corridors This corridor links the resource-rich upgrading of infrastructure along provide the impetus for growth Tete province to the port of Nacala, the corridor improves access to outside the major cities by creating one of the deepest natural ports on markets at either end. This enables special economic zones and the eastern coast of Africa. access to landlocked countries in industrial parks along corridors Southern Africa on the western that promote the development of A planned upgrade to the Nacala end and access to global markets industries other than those based on port will render it capable of via the Nacala Port on the eastern the extraction of mineral resources . handling the output from coal mines end. Proximity to these markets Along the Maputo corridor, mineral in Tete, widely thought to have the can help determine the focus of resource processing industries largest untapped reserve of coal economic development initiatives. have already been established, in the world. The corridor is also For example, agricultural products while the Beira corridor has seen expected to connect rich agricultural targeted at markets in Zambia and investment in agri-business from regions in Nampula province to Zimbabwe can be a better driver development organisations and the a global market and encourage of economic growth in Tete than in private sector (Santos et al, 2015). industrialisation in the city of Nampula province. However, for the Nacala corridor to Nampula. The Nacala corridor will truly be a growth corridor (Galves also create connections to the sea Economic corridors have Nogales, 2014), national policy for landlocked Malawi, Zambia, and successfully attracted private needs to ensure that economic gains Zimbabwe, fostering regional trade investment in manufacturing and generated by the corridor lead to (Santos et al, 2015). transportation infrastructure in improvement in human development Mozambique and encouraged indicators in the regions through The Nacala Corridor is over growth in regions away from the which the corridor passes. 1,000km in length between Tete capital. Cities along the Nacala and Nacala. The development corridor are harnessing the increased The case studies in this report look of road, rail and communication investment in the region through at these governance structures in infrastructure along this length of a variety of innovative structures three cities along the Nacala corridor the corridor has been spurred by to address governance capacity – Tete, Nampula, and Nacala. the international demand for coal and basic service provision. These mined in Tete. Tete is also more structures establish models of suitable than nearby the ports of partnerships between the private Beira and Quelimane to handle sector, international development coal shipping volumes. At the organisations, and central outset, the 17 hour travel time government agencies.

16 Future Proofing Cities | Growth Corridors in Mozambique

Tete

The mining boom in Tete has resulted in $2.74 billion invisible economic growth and generated high levels of formal employment in the city Foreign Investment in Tete province (2014)

Tete City is the capital of the The city is located 200km inland High levels of informality, poor resource-rich Tete province. Located from the Mozambican coast, set on housing conditions, and poor service on the banks of the Zambezi River, a plateau 500m above sea level. The delivery challenge overall livability its population was estimated to be city’s location was chosen because it within the city. More than three- 183,778 in 2011 (Cities Alliance, was the easiest crossing point on the quarters of the city lives in informal 2015a). Tete was established as a Zambezi River. Today, two bridges settlements, and over 70% of its Swahili trade centre for gold and cross the Zambezi, linking Malawi residents live below the poverty line. copper well before the Portuguese and parts of Zambia with Zimbabwe A large proportion of the population colonial era. In the hope of taking and South Africa, and extending the does not have access to water, over the gold trade, the Portuguese influence of Tete internationally. sanitation or solid waste collection. established two settlements on the The city has an area of 286km2 with Only 30.9% have access to potable Zambezi River, one of them at Tete an estimated population density of water inside homes, 48.6% to in 1531. By the mid-17th Century 640/km2, and a population growth sanitation and 26% are covered by Tete had become a market centre for of 4.3%. The recent growth of solid waste collection. Flooding gold , ivory, and copper. In 1761 it mining and related industries has during the 2010 and 2013 monsoon was given a Portuguese town charter led to extensive construction and seasons has highlighted the fragility and became a city of the ‘Overseas a stimulated local economy. It has of existing water supply and Province of Mozambique’ in 1959. also attracted an influx of people, sanitation systems. These exacerbate Located in one of the hottest parts increasing traffic on roads and the risk of contamination of soil of Mozambique, Tete is growing pressure on urban services. and fresh water, and the occurrence rapidly thanks to the abundance of of communicable diseases (Cities mineral wealth surrounding the city. Alliance, 2015a).

Figure 15: View of Tete Figure 16: Street inTete Credit: snnapingafrica.blogspot.co.uk Credit: Johannes Beck / dw.com

17 Future Proofing Cities | Growth Corridors in Mozambique

Tete in numbers

Residents living in informal settlements Population below poverty line % % 44% 70 80 Citizenship Average voter turnout

Foreign % Investment $2.74 $1.28 by province billion $19.8 14 (2014) billion million Formal economy share of employment (2008) Economy TETE MAPUTO NAMPULA

Percentage of government employees with secondary/tertiary education (2015) % % 2.1 4.6 50 municipal employees/1000 residents

Governance City budget from central government

Population with Population with access to access to electricity sanitation Residents covered by solid waste % collection 31 % % Population with % 20.1 26 Services access to potable water inside homes 48.6

Estimated coal reserves in Tete province (2009) % Area in province 60 covered with mining 23 billion tons exploration concessions

Environment

Figure 17: Tete infographic

18 Future Proofing Cities | Growth Corridors in Mozambique

Tete is strategically located city, spurring a construction boom along trading routes connecting mainly focused on new housing; Zimbabwe, Malawi and the northern along with growth in the hospitality region of Mozambique. These routes and retail sectors. In addition, Tete were historically recognised by the has also attracted investments in Swahili and Portuguese traders. Tete construction, energy, hospitality and is still a key regional transport hub infrastructure sectors. for land, air, and river transport. It has an international airport that runs As a city, Tete has seen strong regular flights to South Africa and economic and industrial growth Maputo. The city has also become while also facing challenges in an industrial zone for the extractive governance and local service industry and an administrative delivery. Construction and hub for mining in the region. The mining operations have generated presence of mining companies substantial formal employment and revenues from operations has with spill-over effects in associated led to visible economic growth in industries such as hospitality for the city of Tete and a strong sense residents in the cities of Tete and its of optimism for the future of the neighbouring city, Moatize, which is region. Mining companies have located 5km to the east. The benefits brought technicians and staff to the of this economic growth have not been equal, however. Sudden

Figure 18: Mining activity near Tete Credit: Steve Nichols - youtube.com

19 Future Proofing Cities | Growth Corridors in Mozambique

investment in housing and amenities management and financial powers for mining employees has caused an are still concentrated with the increase in commodity and house national government. prices in the region. For Tete, being part of the Nacala In managing this growth, city growth corridor has meant governance is hampered by a significant regional economic lack of technical and financial growth, aided by connectivity for capacity, as indicated by the low mining and other trade. ‘Company tertiary education rates among towns’ have emerged, particularly in city employees (2.1%) and a high neighbouring Moatize where mining reliance on central government firms have their offices, factories, transfers for funding (50%). This and accommodation. It has also has meant that while the Tete meant that while some sectors have Provincial Development Plan experienced economic growth, local (2007-11) and Tete Municipality service provision, such as public Governance Program (2009-14) health infrastructure for residents is have been formulated, they have not still not fully adequate. yet been adequately implemented. As with other Mozambican cities, planning for urban development occurs at the local level but land

Figure 19: Neighbourhood in Tete Credit: Dw.com 20 Future Proofing Cities | Growth Corridors in Mozambique

What is shaping the city?

Mining companies have addressed service delivery and infrastructure gaps in Tete, albeit for a small proportion of the city’s residents

Unequal provision of urban small minority of residents in Tete The key role of the private sector services and will not be available equally in urban development suggests (see Fig. 17). that well-directed mining revenues The limited coverage of urban can help address the lack of infrastructure and low capacity Recent community protests against technical and financial capacity at of municipal and provincial the increasing influence of mining the local level, and to help finance governments in Tete has led to (BBC, 2016a; Mining.com, 2012) infrastructure and service delivery mining companies taking over many have prompted active government improvements. Government roles in urban development that are involvement to mediate the and local communities should traditionally the city’s responsibility. impact of mining. New policies recognise their key role, for this The larger mining companies are developed in 2012 and 2013 by collaborative approach to succeed. building social infrastructure and the central government determine However, as the mining sector housing for their employees or for minimum standards of housing for is particularly sensitive to global displaced communities that they resettled communities and require commodity price fluctuations, have resettled due to their mining the involvement of government current or anticipated future profits operations. Vale and Rio Tinto, two representatives during resettlement. from the mining industry are not transnational mining companies Taxation laws and new concession a reliable source of financing for operating in Tete have built contracts at the central level have urban services. The emerging model good-quality housing and social been amended to direct a larger of urban development driven by infrastructure including educational share of mining revenues towards investment in mining operations and healthcare facilities. At the community development projects in can be considered effective only if same time, this higher demand for areas directly affected by mining. is accompanied by a transition to a city land generated by new housing, The central government is also diversified economy. office and administrative spaces has debating the creation of a sovereign increased living costs in Tete (Cities wealth fund for harnessing revenue Alliance, 2015a). However, there from mining for investing in is a concern that the benefits of this national development (Macauhub, infrastructure will only flow to a 2015).

Local Government Central Government Private Sector Determining local needs Policy formulation Mining rights Land use determination Prioritisation of needs Development planning Finance Project implementation Land use determination Fees, annual revenues Project implementation Management of service Finance Management of service

Service delivery to Service delivery to city residents some city residents

Figure 20: Emerging service delivery model in Tete

21 Future Proofing Cities | Growth Corridors in Mozambique

Environmental and social grants do not address the loss of industrial development across the trade-offs for growth agricultural land in the province and country (Macau Daily Times, 2015). the impact on livelihoods. They also Tete’s proximity along the Zambezi Mining operations themselves involve displacing and resettling River has provided the city with present long-term environmental of populations. Open-pit mining plenty of hydropower. The Cahora risks in the form of air, water operations in Tete are impacting the Bassa Dam, located further upstream and soil pollution, and near overall environmental landscape in on the Zambezi River produces monopolisation of land use in Tete province and in the city itself. 2,075MW and is southern Africa’s Tete’s hinterland. 60% of the single largest source of hydro- province has been given over as Ready supply of energy electric power (Baobabresources, mining concessions to private Tete has abundant hydro-energy 2016). Plans are being discussed interests (Human Rights Watch, and water supply thanks to its to upgrade this to 3,220MW over 2013). Mining concessions are location along the mighty Zambezi next five years (Reuters, 2011). Tete competing for fertile farmland River. Although Mozambique is is therefore an excellent location since the richest mineral resource a net exporter of power due to to base mining operations limited areas are in production agricultural international agreements with South only by the lack of transportation areas near water sources. For Africa and Zimbabwe, Mozambique infrastructure, which is quickly example, exploration has revealed itself has a net energy deficit with being addressed. Plans are underway the presence of high coal deposits demands increasing by about 14% to construct two additional dams in areas near the Zambezi and each year (82MW). The expansion near Tete – Lupata and Boroma Revuboe rivers, which are also of the energy sector is one of Dam with combined potential for highly productive agricultural Mozambique’s greatest economic 626MW at an investment of nearly areas. The mining concessions challenges, given the growing US$1.6bn.

Figure 21: New bridge under construction Figure 22: Cahora Bassa dam. Credit: Snnapingafrica.blogspot.co.uk Credit: Thorndoncook.com

22 Future Proofing Cities | Growth Corridors in Mozambique

Historic levels of foreign been discovered near Tete with direct investment estimated reserves at 750 million tonnes. Mining companies have Thanks in large part to the mineral started investing in the region wealth of Tete, Mozambique is towards the extraction of these rising up from the devastation of minerals. civil war to become home to one of the continent’s fastest growing Weak transport infrastructure and economies. Foreign investment in a government’s ruling against Tete province dwarfs that of other using the Zambezi River to barge provinces and is driven mostly coal has led international mining by investments in the mining companies, such as the Brazil- sector (Macauhub, 2015). Tete’s based Vale and Japanese investment status as one of the most mineral house Mitsui, to finance, construct, rich locations in the country is operate and manage over 1000km driving massive foreign interest of rail network and port facilities and investment into the country to the ports of Beira and Nacala, in such as Moatize Mines ($1,535m partnership with the government investment) and Benga Coal (Allafrica, 2016b; BBC, 2016b; Project, an investment of US$849m Cities Alliance, 2015a). Vale alone (Embassy of Mozambique, 2012). has reportedly invested US$4.4 Additionally, huge deposits of iron billion in rail and port facilities in ore, vanadium and titanium have the corridor (Bloomberg, 2013).

Figure 23: Railway Tete - Nacala under construction Credit: Dw.com

23 Future Proofing Cities | Growth Corridors in Mozambique

Key Themes

Informality in economy and Low participation in planning Resettlement processes housing Partly as a result of the planning Exploration for coal and other A large proportion of Tete’s residents occurring at the district and provincial minerals has resulted in the live in informal settlements along the level, communication on planning resettlement of many villages in the city’s periphery. Most employment is issues between city residents and local province. In many cases, villages in the informal sector. government is not sufficient. Citizen near agricultural land with high groups are active in the city particularly productivity have been moved to Citizenship around issues of resettlement, but not less desirable locations, increasing formally involved in planning. vulnerability for the resettled residents.

Mining boom Unequal growth High agricultural output The growth of mining in the The benefits of mining-driven economic The Tete province is well-watered last decade has attracted foreign growth has been unequal. The sudden and has a relatively high agricultural investment to the province, with investment in housing and amenities for output. The city has potential as an spill-over effects in the city which mining employees has caused a rise in agri-business hub. serves as the administrative hub for commodity prices in the region. the industry. Formal employment opportunities have increased, Economy along with growth in sectors like construction and hospitality

Incomplete decentralisation Development plans Lack of land management As with other Mozambican cities, The Tete Provincial Development Plan control planning for urban development (2007-11) and the Tete Municipality Mining concessions are granted occurs at the local level but land Governance Program (2009-14) have by the central government, and management and financial powers are been formulated. But low capacity may overrule local government still concentrated with the national means that the implementation is not planning for the area. Over 60% of government. Central government adequate. Tete province is currently under an transfers constitute over 50% of the exploration concession, or being municipal budget. Governance considered for one.

Poor infrastructure delivery ‘Company towns’ Public health infrastructure The city does not have infrastructure Particularly in Moatize, mining Public health infrastructure is or management capacity to provide companies have established housing, insufficient to manage epidemics, sufficient services to residents. This social amenities and robust physical particularly of water-borne diseases. is particularly evident in sanitation infrastructure for locals and expatriates Climate change models predict and housing working in the mining sector. the higher prevalence of infectious diseases, which the city does not have Services adequate capacity to manage.

Mining operations The conflict between mining and Reliance on the Zambezi River Most mining in the province is open- agricultural uses The Zambezi is the source of pit mining which is hazardous for Exploration has revealed the presence water for agriculture and industry, the environment. The proliferation of of high coal deposits in areas near the and the Cahora Bassa dam on the mining in the province has increased Zambezi and Revuboe rivers, which river provides hydro-energy to the air, water, and soil pollution. are also highly productive agricultural province. Reduced water levels in the areas. Mining concessions do not Zambezi due to climate change are a address the loss of agricultural land in cause of concern in this context. Environment the province.

24 Future Proofing Cities | Growth Corridors in Mozambique

Tete airport To Nacala With the growth of mining, traffic at the airport has increased. It now serves a number of international destinations

Mining companies have built housing for employees in Moatize and Tete

Moatize

Tete-Nacala railway line The railway line to Nacala port is being upgraded with funding from Vale Mining

Tete

Benga mine

Extensive informal settlements grew on the outskirts of cities during the Mozambican civil war Benga village Moatize mine One of the many villages in Natural drainage channels The mine is connected via its own Tete province resettled due and water bodies are at risk of rail terminal to the ports at Nacala to the growth of mining pollution due to coal mining and Beira

To Harare Zambezi River Climate change may reduce river water levels affecting agriculture Figure 24: Tete map and hydro-energy generation 25 Future Proofing Cities | Growth Corridors in Mozambique

Tete airport To Nacala With the growth of mining, traffic at the airport has increased. It now serves a number of international destinations

Mining companies have built housing for employees in Moatize and Tete

Moatize

Tete-Nacala railway line The railway line to Nacala port is being upgraded with funding from Vale Mining

Tete

Benga mine

Extensive informal settlements grew on the outskirts of cities during the Mozambican civil war Benga village Moatize mine One of the many villages in Natural drainage channels The mine is connected via its own Tete province resettled due and water bodies are at risk of rail terminal to the ports at Nacala to the growth of mining pollution due to coal mining and Beira

To Harare Zambezi River Climate change may reduce river 0 1 2.5 5 km water levels affecting agriculture and hydro-energy generation 26 Future Proofing Cities | Growth Corridors in Mozambique

Summary of environmental risks Three dimensions of environmental risk

Pollution of land, water, and air due to increased mining over Climatic risk the last decade is a key driver of The impact of climatic events on environmental risk in Tete. urban populations, infrastructure and economies

Mining concessions cover nearly 60% of the land area in Tete province. Rich veins of coal have been discovered under fertile agricultural land near the Zambezi and Revuboe Rivers, and have resulted in the displacement of farming communities. Coal mines have also been set up close to the urban centres of Tete and Moatize. While mining is driving economic growth in Tete, the environmental hazards of open- pit mining are a cause for concern for the region. Like other Mozambican cities, Tete has poor and limited urban infrastructure and a high proportion of residents in informal settlements, which increases their Biological & natural vulnerability to environmental threats and hazards. resource risk The impact of scarcity or degradation of natural resources on urban populations and economies

Geophysical risk The impact of geophysical event on urban populations, infrastructure and economies

27 Future Proofing Cities | Growth Corridors in Mozambique

Types of threat or hazard, with current and estimated future risk rating Extreme temperature Storm Drought Flood

Climate change models Tete sees frequent storms Tete is in a high Flooding along the Zambezi predict a 2-2.5°C rise in during the monsoon season. desertification risk zone, and usually occurs in its lower Mozambique. Tete is almost The lack of effective drainage the region has seen extended reaches. However, poor surrounded by coal mines, systems drive increased risk droughts in the last twenty drainage infrastructure causes which may cause localised during storms in the city. years. Extreme temperature floods in Tete during rainfall. temperature increases. Poorly and reduced rainfall due to With increased occurrence constructed housing in climate change will increase of extreme rainfall events, informal settlements do not the frequency of droughts. the occurrence of floods may provide protection against increase in the city. extreme temperatures.

Contamination Crop disease, Air quality or depletion of infestation or Fuel scarcity degradation fresh water failure Open-pit coal mining is the Rich coal veins have been High frequency of droughts Like other Mozambican most commonly practised discovered near teh Zambezi have already affected cities, oil and candles are form of extraction near and Revuboe rivers which agriculture in the region. the primary energy source Tete. This type of mining is are major freshwater sources Climate change is expected to for 55% of households. associated with increased for the region. Poor capacity worsen droughts, leading to Increased investment in air pollution. With its large to enforce environmental increased occurrence of crop electricity generation may reserves of coal and increased policies has led to increased failure. help reduce dependence on mining investment, air quality water pollution from mines. these sources of energy. degradation is bound to be a key risk in the future. Soil contam- Raw materials ination and Mineral degradation or Vector-borne Water-borne erosion depletion scarcity disease disease

With one of the largest coal Tete has one of the largest Land degradation is a Densely packed, poorly Poor sewage infrastructure, reserves in the world, mining coal reserves in the world common occurrence due to services housing combined dense and poorly constructed activity is expected to sustain along with significant deposits the prevalence of mining with a poor health housing are key drivers of Tete’s economy in the near of other valuable minerals. concessions through the infrastructure system increases water-borne disease in the city. future. Poor environmental Mineral depletion is a low risk province. the risk of vector-borne policies and lack of for the near future. diseases in Tete. enforcement capacity will worsen soil contamination due to mining.

Air-borne disease

The risk of air-borne disease is driven by dense housing conditions and poor health infrastructure.

Earthquake Legend

While Tete is in a moderate Current Estimated earthquake risk zone, poorly risk future risk constructed informal housing increases the risk to human Low life and property even during relatively low magnitude Medium earthquakes. High

28 Future Proofing Cities | Growth Corridors in Mozambique

Future challenges

Increased rural-urban migration due to two key challenges may be a cause for concern in the context of Tete’s current governance capacity and the extent of informality in housing and the economy

The future of the Zambezi periods, and more extreme has significant impacts on the floods. Multiple studies cited by region as well. In particular, it River the Intergovernmental Panel on affects operations of the Cahora For Tete, in the central region of Climate Change (IPCC) estimate Bassa dam which generates Mozambique, climate change is that rainfall across the Zambezi electricity for a substantial portion projected to result in increased River Basin will generally decrease of Mozambique, and neighbouring temperatures, a slight increase in by 10-15% over the next 100 years. countries. rainfall, erratic rainfall patterns, and All Zambezi Basin countries will One cause of concern is the an overall increase in evaporation experience a significant reduction over-reliance on the Zambezi rates (weADAPT, 2011). In the in average annual stream flow. River as a water source. It is future, these changes will lead to Studies estimate that runoff will used for people and industry in reduced water flow in primarily decrease by 26–40% by 2050 Tete, national power production rain-fed rivers, a gradual increase (International Rivers, 2012). In along the existing and planned in drought risk and desertification recent years, the area around dams, irrigation for agriculture (Fig. 26). For the city, drought and the Zambezi River near Tete has and small-scale fishing, which consequent crop failures in the experienced frequent floods that are both linked to livelihoods. A primarily agricultural region around it caused significant damage to human reduction in water flow or levels in may increase migration to Tete City, life, infrastructure, and farms. The the Zambezi River could have an compounding environmental risks. frequency of floods on the Zambezi is attributed to unpredictable impact on energy production and The Zambezi will experience rainfall patterns caused by climate water security and consequently on drier and more prolonged drought change (Fant et al, 2015). Flooding industrial output.

Tanzania

Zambia

Malawi

Lilongwe

Nacala Nampula Cuamba

Nampula

Tete

Harare

Figure 25: Zambezi River Zimbabwe Credit: Jacques Pinette - Flickr

Very high Risk

29 Figure 26: Desertification map in Mozambique High Risk Moderate Risk Beira Dependency on the mining between one-third and half of their on formal employment, any city sector 2011 peak (SARW, 2014). Recent service provisions provided by the local hiring and wage provision mining sector, local community Since the mid-2000s, mineral laws such as the 2014 Mining development funds or the national exploration and extraction in Tete Law have increased the total costs sovereign wealth fund that relies on province have been significant involved in extraction, which has funding from mining fees and profits drivers for Mozambique’s economic further hit the Tete mining industry. are at risk to global fluctuations in growth. As discussed earlier, These new laws, combined with commodity prices. due to Tete’s location and poor the high transportation costs and transportation network, mining the global downturn in commodity companies have had to invest prices, has led a number of mining in infrastructure to connect Tete companies to cut production in with Nacala Port (The Economist, existing mines and slow rates of 2016). In spite of these additional investment in new mines in the costs, generally high commodity province (The Economist, 2016). prices have made coal mining a The mining industry dominates the profitable venture in Tete (SARW, formal employment sector, either 2014). More recently, a number of directly in mining operations, or factors have resulted in a global indirectly through construction, downturn in the mining industry. By transportation and hospitality 2014, coal prices had declined to industries. Besides the direct impact

Figure 27: Vale coal mining in Tete Credit: mozambiqueminingpost.wordpress.com Future Proofing Cities | Growth Corridors in Mozambique

Privatised urban management The environmental and social is a concern particularly as any cost of mining failures will affect a high number Nearly 60% of the province of Tete of people (Human Rights Watch, is covered by land concessions either Critically for the purposes of 2013). granted or under process by the the Nacala economic corridor, national government (Human Rights the province has vast yet largely The anticipated growth of mining in Watch, 2013). Much of the land is untapped mineral deposits including Tete will have great social impact. near urban growth centres or fertile gold, iron ore, vanadium, titanium, As of October 2012, the approved agricultural land along the Zambezi and uranium (World Bank, 2010). and pending applications for mining and Revuboe rivers. This has led One of the major drivers for the concession and exploration licenses to land disputes in both urban and conception of the Nacala corridor is covered 60% of the province’s total rural areas. Two of the largest coal Tete’s coal deposits (Reuters, 2016) land area (Human Rights Watch, mines are located close to the cities thought to be the largest unexploited 2013). The anticipated displacement of Tete and Moatize (Human Rights reserve of coal in the world (World and relocation of communities Watch, 2013). Any urban planning Bank, 2010). The type of mining may result in loss of livelihood, and development strategies for Tete practiced in the region is open-pit social networks, and community will need to account for the amount mining which is known to have a resilience. of land under the mining sector’s large impact on air pollution, land control. At the same time, displaced degradation, water pollution and agricultural communities may carbon emissions. Mitigation of increase the rate of migration to Tete environmental impacts of mining due to loss of livelihood.

Figure 28: Miners at work in Tete Credit: Steve Nichols - youtube

31 Figure 29: Road in Tete province Credit: Ismael Mia - Flickr Future Proofing Cities | Growth Corridors in Mozambique

Nampula The city spends

A productive hinterland and strategic location along the corridor make Nampula a viable $14.6 manufacturing and agri-business hub for on each resident Northern Mozambique per year

The ‘Queen of the North’, Nampula the Zambezia and Cabo Delgado is the capital of Nampula Province, provinces. In addition to these two Mozambique’s most populated transport links, a small international province. The city, founded in 1907, airport lies 4km outside the city was originally located on a plateau centre. Nampula’s population has to serve as a colonial military centre more than doubled within the last for the entire north of the country. two decades and currently has a The city grew substantially in the growth rate of 5.7%. The higher last decades of Portuguese rule as percentage of males in the city it was a strategic military centre suggests that many men have come in the fight against the Frente to the city seeking work. This rapid de Libertação de Moçambique population growth has put pressure (FRELIMO) a national liberation on many city services as well as movement (UCLG, n.d.). Now environmental resources, with 82% considered the ‘capital’ of northern of residents living in housing that is Mozambique, it has an estimated unsafe and poorly serviced (Cities population of 622,423 in 2015 and Alliance, 2015b). covers an area of 404km2. Nampula is Mozambique’s third largest Similar to other Mozambican cities, city and is a hub for business and municipal governance is hampered manufacturing (World Bank, 2010). by a low municipal budget and lack of technical capacity. The large This dynamism is partly fuelled by Figure 30: Street in Nampula the surrounding well-drained, fertile informal economy makes it difficult Credit: jakelyell.com land that supports the production to collect sufficient tax revenues of various food and cash crops. to support local governance and The city itself is home to several service provision. Consequently, markets, cathedrals, and mosques as the city has a small budget that well as the National Ethnographic relies heavily on central government Museum. The city is dense but also support (Cities Alliance, 2015b). features broad avenues. It is set in The lack of effective coverage by lush surrounding countryside dotted sanitation systems has led to sewage with ‘inselbergs’ – large masses of discharge into rivers and illegal smooth volcanic granite. sewer connections that overload the existing network. Periodic health Nampula is located in the centre of epidemics occur, caused by poor the province, surrounded by plains sewage disposal and contaminated and rocky outcrops. The city is at drinking water (Cities Alliance, the junction point of the railway line 2015b). Industrial pollution of water that links Nacala Bay to Malawi sources has also occurred as a result and also the road axis between of the informal economy. Figure 31: Street in Nampula Credit: skyscrapercity.com

33 Future Proofing Cities | Growth Corridors in Mozambique

Nampula in numbers

Residents living in informal settlements

Population below poverty line % 70% 5.7% 80 Citizenship Annual population growth rate 80% rural % Average farm size +90 $604.50

3.6 million / 4.5 million residents Employment engaged in 1.5 City per capita GDP Economy hectares live in rural areas informal economy

Percentage of government employees with secondary/tertiary education (2015) 2% $14.6 2.23 Municipal expenditure. municipal employees/1000 residents Residents/year

Governance

Residents covered by solid waste collection % % 14 9% Services 5.5 Population with Population with access to potable water inside homes access to sanitation

2006 At this rate, no 137,000 forest cover by hectares of forest cover lost for 2009 agricultural purposes every year since 2006, representing 3% of 2013 forest cover in the province a year 2035 Environment 2015

Figure 32: Nampula infographic

34 Future Proofing Cities | Growth Corridors in Mozambique

Nampula is strategically opportunity for employment in the has been established to enable local positioned to act as a business and formal industries to be established government to better integrate administrative hub in Northern in Nampula, especially considering various programs and projects Mozambique. The agri-business that over 90% of employment is in carried out by the other agencies. sector in Nampula has seen the informal sector. While these agencies are helping to increased investment, through address key challenges in the city, international development Nampula has seen rapid population they also compete with the private programmes like Plano Estratégico growth in recent years and has a sector for skilled labour. This may para Desenvolvimento do Sector number of strong economic growth present a challenge in supplying Agrário (PEDSA). There is also areas, particularly around large agro- local workers for formal jobs in strong interest from private sector industry and mining projects. At the the emerging private sector (Cities mining and agro-industries too. same time, the city has high levels of Alliance, 2015b). Other potential growth sectors informal housing and low technical Finally, for Nampula, being part include tourism, horticulture, capacity to address service provision of the Nacala growth corridor is biofuels and fishing. The city has a challenges. Parastatal agencies likely to increase mining-related large amount of donor investment that create collaborations between industry. However its location in into infrastructure such as roads, local and central governments and the middle of this corridor means water and sanitation. In terms of international development agencies that the most significant trade and capacity, the city has relatively are being formed to address the lack industry investments may take place high literacy and higher education of technical and financial capacity in Nacala and Tete. rates compared with the rest of in local government. A development Mozambique. This presents a natural co-ordination agency (UCODIN)

Figure 33: Waste management in Nampula Figure 34: Nampula street vendors Credit: Thomas Stellmack/Flickr Credit: Thomas Stellmack/Flickr

35 Future Proofing Cities | Growth Corridors in Mozambique

What is shaping the city?

Through collaborations with international NGOs, development organisations and central government agencies, Nampula’s local governments are able to provide services and development programs to their residents

Re-emergence of the city as Population change and Today, Nampula has a very young business hub demographics population, with half of the population under the age of 15. This Owing to its strategic location and as Napula has a history of massive is expanding by 5.7% every year. A the capital of one of Mozambique’s rural to urban migration as a result majority of the population in the city most populated provinces, Nampula of conflict. The city’s first growth lives in poorly serviced and informal is well positioned as a business spurt was due to the presence of a housing on the edge of the city. This and administrative hub for a vast military base in the city, which was demographic dividend can benefit hinterland in northern Mozambique. first established in 1907. Later, after the economic development of the The business community went independence in 1975, Nampula was city if urban poverty can be checked through difficult times during the largely abandoned by the military. and inclusive economic growth is civil war between 1977 and 1992 Rural populations occupied the achieved. – a period characterised by a lack city, squatting in unplanned peri- of investment in industry and high urban areas (UCLG, n.d.). The informal employment. The end outbreak of civil war dramatically of the conflict brought structural increased migration to Nampula, adjustment policies in the 1990s. with many people seeking safety. In time, investment has returned. When the conflict ended, migration Economic development collaboration continued to increase but this with international organisations is time for economic reasons: most now leading to strategic investment development is occurring in urban in opportunity areas such as in the areas. agri-business sector.

Figure 35: Cashew processing in Nampula Figure 36: Informal economy in Nampula Credit: nextbillion.net Credit: Magazineindependente.com

36 Future Proofing Cities | Growth Corridors in Mozambique

Greater role of parastatals in levels, gaps in service delivery are The formation of the Nampula service delivery increasingly addressed through the Co-ordination Unit for Integrated creation of ‘parastatal’ agencies with Development (UCODIN) represents Nampula shows a number of support from foreign donors (Fig. an evolution of this model of service examples of alternative approaches 37), such as the Integrated Road delivery. Created by the Nampula to service delivery and development Sector Program (PRISE) run by the provincial government, UCODIN that have addressed the local central government and financed is an agency that co-ordinates local capacity and budget challenges. by a number of international development and links various One example is the ProSavana agencies including the World Bank, development stakeholders including project, run by the central Ministry ADB, MCC, DFID, and JICA; international agencies and municipal of Agriculture financed by the and the Water Sector Services and governments. Through this model, Brazilian Cooperation Agency Institutional Support (WASIS) service delivery and economic (ABC) and Japan International project, financed by investment from development initiatives can share Cooperation Agency (JICA). The international agencies and set up knowledge, best practices for project seeks to spur economic by the National Water Directorate interventions and enhance technical development in Nampula province (DNA). These examples show capacity across local government through investment in education how collaborative models can be institutions. From the perspective and technology for modernising instrumental in addressing gaps in of decentralisation, having a co- agricultural practices, improve technical and financial capacity to ordination agency at the provincial yields and form new agribusinesses. deliver services. level represents a step forward. At municipal and provincial

Central Government Local Government International Development Policy formulation Determining local needs Organisations Development planning Prioritisation of needs Development planning Land use determination Project implementation Finance Finance Management of service Technical and knowledge support

Sanitation Water Supply Economic Power Supply Education parastatal parastatal development parastatal parastatal parastatal

Service delivery to city residents

Figure 37: Emerging service delivery model in Nampula

37 Future Proofing Cities | Growth Corridors in Mozambique

Key Themes

Informal housing Literacy and higher Skills mismatch A majority of the population in the education Economic growth has brought city lives in poorly serviced and Compared with the other two opportunities for formal informal housing. cities along the corridor, Nampula employment in the city, but has more residents with higher there is a skills mismatch for education. these jobs within city residents. Skills training institutes funded by development organisations are attempting to address this Citizenship mismatch.

Informality in economy Business hub Investment in agri-business The closure of formal industries Owing to its strategic location The agri-business sector in due to the civil war and the lack and as the capital of one of Nampula has seen increased of investment in the industrial Mozambique’s most populated investment through programs sector due to structural adjustment provinces, Nampula is well like PEDSA, PRONER, PAPA policies in the 1990s has led to high positioned as a business and involving collaborations with informal employment. administrative hub for northern international development Mozambique. organisations. Economy

Active civil society Presence of parastatals Formation of UCODIN Nampula sees high civil society The lack of technical and The formation of the Nampula participation in governance. Civil financial capacity in local development coordination society groups have been driving government is being addressed agency (UCODIN) enables local the movement for participatory through the formation of government to better integrate budgeting in the city. parastatal agencies that create various programs and projects collaborations between local carried out by the parastatal and central governments and agencies. international development Governance agencies.

Poor service delivery Presence of donor Capacity building for services The city experiences poor service investment infrastructure delivery, particularly in sanitation. Through the formation of The World Bank, USAID’s parastatal agencies like GAPASU, Millennium Challenge Corporation WASIS and NWDP, international and African Development Bank organisations have invested are funding capacity building in water supply and sanitation programs for local governments. Services upgrades in the city.

Loss of forest cover Climate change impacts Industrial pollution of water Increasing land coverage under The province is particularly bodies agriculture, fuel, and building use is susceptible to droughts due to Formal and informal industries leading to declining forest cover in climate change. are increasing pollution in water the province. bodies in the province and city. Environment

38 Future Proofing Cities | Growth Corridors in Mozambique

Monapo dam Providing Nampula with fresh water and energy, the Monapo is due for upgradation

To Cuamba, Lilongwe, Tete

Tete-Nacala railway Industries Nampula shows a relatively higher formal industry base compared to the other two cities

Education infrastructure Nampula has a relatively higher number of schools and educational institutions

International Airport

To Nacala

Provincial capital + As capital of Nampula province, the city has presence of government buildings and institutions +

Military compound

To Quelimane, Maputo

Figure 38: Nampula map 39 Future Proofing Cities | Growth Corridors in Mozambique

Monapo dam Providing Nampula with fresh water and energy, the Monapo is due for upgradation

To Cuamba, Lilongwe, Tete

Tete-Nacala railway Industries Nampula shows a relatively higher formal industry base compared to the other two cities

Education infrastructure Nampula has a relatively higher number of schools and educational institutions

International Airport

To Nacala

Provincial capital + As capital of Nampula province, the city has presence of government buildings and institutions +

Military compound

To Quelimane, Maputo 0 1 2 4 km

40 Future Proofing Cities | Growth Corridors in Mozambique

Summary of environmental risks Three dimensions of environmental risk

Drought and desertification is a key concern for Nampula, driven Climatic risk by climate change and high The impact of climatic events on deforestation rates urban populations, infrastructure and economies

Nampula province is marked by a high reliance on agriculture, and a key industry in the city of Nampula is agri-business. The occurrence of droughts has increased in recent years, driving increased migration to the city along with increased pressure on its freshwater sources. The province also sees a high rate of deforestation, increasing soil erosion and worsening impact of droughts on the agricultural economy. Poor civic infrastructure and housing conditions in Nampula are other significant drivers of risk. Increased migration will enhance the pressure on inadequate urban systems, exacerbating risk to a range of Biological & natural environmental threats and hazards. resource risk The impact of scarcity or degradation of natural resources on urban populations and economies

Geophysical risk The impact of geophysical event on urban populations, infrastructure and economies

41 Future Proofing Cities | Growth Corridors in Mozambique

Types of threat or hazard, with current and estimated future risk rating Extreme temperature Storm Wildfire Drought Flood

Climate models predict Nampula sees regular storms Informal housing in the Climate change models Poor drainage system in the temperature increases of during the monsoon. Climate city is poorly constructed, predict higher occurrence of city increases the risk of 2-2.5°C in the semi-arid change models predict with inflammable materials droughts for Nampula. For floods during the monsoons. Nampula province. Poor extreme rainfall patterns, used int he construction of a city reliant on rivers for Inconsistent rainfall due to housing conditions increase leading to increased strength roofs and walls. Extreme freshwater, increased drought climate change may increase the risk to residents from or frequency of storms. temperatures and higher occurrence can severely the chance of extreme rainfall extreme temperature. drought occurrence may impact water security. events and increase the risk increase the possibility of against floods. wildfires in the city.

Contamination Crop disease, Air quality or depletion of infestation or Fuel scarcity degradation fresh water failure Nampula’s fine, dusty soil is While Nampula has seen Crop failures have increased Oil, kerosene and paraffin oil prone to erosion and the city upgrades to its freshwater in Nampula province due to are the main energy source for already experiences frequent storage systems, the increased droughts. The region is also 65% of the city’s households. dust storms. Deforestation in frequency of droughts will put at high risk of desertification Unlike Nacala and Tete, there the province is expected to pressure on water sources. which may reduce the are no large energy projects increase soil erosion and the availability of agricultural planned near Nampula. The frequency of dust storms. land in the province. Rural low supply chain diversity is a crises will cause increased significant threat as a result. urban migration.

Soil Raw materials Loss of Vector-borne Water-borne contamination degradation or biodiversity and erosion scarcity disease disease

High rates of deforestation Nampula is one of Deforestation in the area Dense housing conditions and Poor sewage infrastructure, have led to susbtantial soil Mozambique’s most populated surrounding the city of poor health infrastructure are dense and poorly constructed erosion in Nampula province. provinces. The prevalence Nampula is a prime driver key drivers of risk to vector- housing are key drivers of Poor land management and of subsistence agriculture of biodiversity loss. Poor borne diseases. water-borne disease in the city. ineffective enforcement of and high rates of soil erosion enforcement of environmental environmental policy are will cause land degradation. policy may increase the risk of drivers of future risk to soil reducing the availability biodiversity loss. erosion. of land as a resource for its primarily agricultural economy Air-borne disease

The risk of air-borne disease is driven by dense housing conditions and poor health infrastructure.

Mass movement Legend Nampula is in a relatively low earthquake risk zone. Current Estimated The natural flow of water risk future risk is interrupted by unplanned Low construction and has led to landslides in the peri-urban Medium areas of Nampula. Poor enforcement of building High and planning codes may exacerbate this risk.

42 Future Proofing Cities | Growth Corridors in Mozambique

Future challenges

As the business and administrative hub of an agricultural based economy, Nampula relies on regular rainfall to bring economic prosperity to the city

Reliance on international time, unexpected changes in the charcoal production and a lack of development political or financial environment viable energy alternatives in rural may halt existing programmes that and urban areas. The second cause As discussed previously, the city rely on international development of deforestation is the conversion has a number of cases where local organisations. Recently, the of forest land to agricultural use capacity and budget constraints suspension of funding from the IMF through slash-and-burn methods. have been addressed through and other international organisations collaborative models of service due to the central government’s Removing forest cover may delivery and development. These undeclared debts has halted new increase agricultural production in examples show how alternative programme finance in the country the short term, but increases the models can be instrumental in (BBC, 2016c). vulnerability of the province and addressing gaps in technical city to extreme weather events such and financial capacity to deliver Increased migration due to as flooding and landslides during services. However, an over-reliance deforestation heavy rainfall. With over 80% of on international development the province’s residents relying on agencies can leave the city The city’s geographic location agriculture, vulnerabilities in rural vulnerable to sudden changes in leaves it susceptible to soil erosion, areas surrounding Nampula can funding priorities outside the city’s and loss of tree cover may increase magnify risks in the city. If current control. Funding from international the rate of loss for fertile top soil. deforestation trends continue, it may development agencies seems to Forest cover has been declining impact the city through increased flow through to individual projects, in the province at a rate of rural-urban migration and add more which limits the scope for integrated approximately 1.2% per year. The pressure on the limited service development planning. At the same primary cause of deforestation is capacity of the city.

Figure 39: Commercial street in Nampula Credit: ev.mu 43 Future Proofing Cities | Growth Corridors in Mozambique

Climate change bringing drought Unlocking the economic potential as a key barrier to markets for and extreme weather events of Nampula’s hinterland agricultural products. For these constraints, baseline levels are low, Climate change models predict Over 80% of the working population and minor improvements in banking, reduced overall rainfall for the in Nampula province is employed infrastructure and institutional province, while extreme weather in agriculture. The dominance of mechanisms can have significant events will bring more precipitation. rain-fed, subsistence agriculture impacts on economic growth in the For the province, this will impact on small farms limits the potential agricultural sector (Musoke and the primarily rain-fed agricultural for economic development Jamac, 2013). practices in the region. With a rural in agriculture. However, the economy dependent on subsistence agricultural sector has the potential Nampula city is already a hub farming, a drop in agricultural to drive economic development in for agro-businesses in Northern productivity may lead to increased Northern Mozambique and Nampula Mozambique. One of the aims of rural-urban migration. The added city as the business hub for the developing the Nacala corridor is to population pressure will affect the province. enable access to markets in Southern already poor services in Nampula city. Africa as well international markets The Ministry of Agriculture’s in Asia and Europe through the Nampula relies on its monsoon season Strategic Plan for Agricultural Nacala Port. An improvement in for water supply to the city. Reduced Development has identified key the secondary road network in the rainfall driven by climate change barriers to agricultural development provinces around the corridor could will contribute to water shortages in in Mozambique. These are: low help unlock the economic potential the city. At the same time, the city’s access to credit for farmers, low of Nampula’s hinterland. drainage infrastructure does not have farm productivity levels, lack of the capacity to manage increased market-oriented production and rainfall during extreme weather events lack of infrastructure to encourage like storms and hurricanes. Climate market access. In Northern change is likely to lead to increased Mozambique, the Strategic Plan flooding in low-lying areas of the city. identifies the poor road network

Figure 40: Droughts result in crop failure in in Nampula Credit: Farmersreviewafrica.com

44 Future Proofing Cities | Growth Corridors in Mozambique

Nacala % A modernised port in one of East Africa’s 3 deepest natural ports will help Nacala lead Northern Mozambique’s economic growth of households have access to piped water

Nacala City is situated on the In addition to its port and rail links, However as with other cities on northern coast of Mozambique and Nacala has an airbase that was the Nacala corridor, the city faces is the one of the deepest natural recently certified for national and a number of important challenges ports on the east coast of Africa. international flights. The city’s associated with poor urban service Also in Nampula province, it is the population is growing at an annual delivery and infrastructure. 80% of next largest city after Nampula with rate of between 3.7 and 4.5%. the city’s residents live in informal a population of 206,449 in 2007 Nacala has a relatively strong settlements, although a lower (Cities Alliance, 2015c). Nacala formal sector, which accounts for percentage (55%) lives below the was founded in the 1960s when 55% of employment. The port is a poverty line compared with Tete the Portuguese drained a swamp, significant source of employment, or Nampula (an average 70%). In across the Nacala Bay from the and foreign investment in industries spite of investments in large water older city of Nacala-a-Velha. It is accompanied by training and and energy infrastructure projects, was developed as a deep water skill-building institutes. The city coverage rates for these services port and industrial, agricultural and has seen a large increase in cargo in Nacala are still low. Only 3% exporting centre during the last passing through in recent years, of residents have access to piped period of Portuguese rule until the from 1.05m tonnes in 2009 to 2.17m water within their houses, and nearly mid-1970s (UN-Habitat, 2010). As tonnes in 2014. GDP per capita has half the population has no access the terminal for the Nacala Railway also increased from $470 in 2008 to sanitation. While the solid waste and the Nacala Corridor, the city is to $620 in 2013, and is predicted collection is robust within the city a key transport and trade hub for the to reach $890 by 2018. For the centre, in peri-urban areas coverage country and region. Mozambique Special Economic Zone of Nacala plummets to 35%. The city is also Island, a UNESCO World Heritage (described below), economic and vulnerable to epidemics due to an site, lies 53km due south of the city, social improvements are expected to under-resourced and insufficient which, along with numerous pristine well exceed the national average and health care system. beaches along the Nacala coastline, likely the province (Cities Alliance, is increasingly attracting tourism to 2015c). the area.

Figure 41: Nacala city Credit: Aziz Vasa - youtube

45 Future Proofing Cities | Growth Corridors in Mozambique

Nacala in numbers

Residents in Residents living in informal settlements absolute poverty % % 3.65 - 4.5% 55 80 Projected annual population growth rate

1.05 million tons 2.17 million tons $620 $820 % 2014 45 2009

2013 projected 2018 Low proportion of informal Cargo passing through Nacala employment City per capita GDP

Percentage of government employees with secondary/tertiary education (2015) 1.78 2% $24 Municipal expenditure Municipal employees/1000 residents per resident / year

% % 100 35% 55% 3 Solid waste collection Solid waste collection Population with Access piped water within their house within city limits in peri-urban areas access to sanitation

5 ...by the end of the century, this will 1985 - 1998 increase to 75% 11 1999 - 2012 50% of Nacala’s land area will be inundated in a 1-in-100 year flood Number of cyclons

46 Future Proofing Cities | Growth Corridors in Mozambique

Nacala is clearly strategically The frequency of cyclones is Large infrastructure projects such located for business and trade, increasing (five between 1985 and as the upgrade of the Nacala Dam, and the recent establishment of 1998 and 11 between 1999 and new electricity generation plants and the airport puts the region on the 2012), as well as the likelihood improvements in distribution networks tourist map both domestically and that 50% of the city’s land area will has occurred in the last 10 years. internationally. Compared with be inundated by a one-in-100 year more developed Mozambican ports flood event. In 2007 the government established like Maputo and Beira, Nacala a Special Economic Zone (SEZ) Nacala port is undergoing has a higher natural capacity to in Nacala. The SEZ represents the modernisation and transportation accommodate the shipping of gateway of the Nacala Development linkages to Tete province are natural resource exports from Tete Corridor to global markets and improving. In spite of the and Nampula provinces and provide attracts considerable private sector construction activity, the port has access to sea trade for landlocked investment, with opportunities for all handled nearly double the cargo in Zambia and Malawi. The recent types of industry and technology parks only five years from 2009-2014. The discovery of natural gas deposits through both fiscal and tax incentives. national government has recognised along the northern Mozambican Nacala’s position at the end of the the potential of Nacala port and coast near Nacala represents another growth corridor, along with the SEZ, is investing in transportation economic opportunity based on are evidently very important for its infrastructure such as upgrading natural resource processing and strategic growth. The improvement of the Nacala port, development of the shipping for the city. However, the transport connections to the mining Nacala Airport and expanding the city’s coastal location also means industry in Tete will be mutually capacity of the railway line between it faces an increasing number of beneficial for the growth of both Tete and Nacala, passing through environmental hazards. cities. Malawi.

Figure 42: View of Nacala Figure 43: Nacala International Airport Credit: Aziz Vasa - youtube Credit: odebrecht.com

47 Future Proofing Cities | Growth Corridors in Mozambique

What is shaping the city?

Special economic zones are addressing service delivery and infrastructure gaps in Nacala, albeit for a small proportion of the city’s residents

The rise of special economic with private investors and with funding from the Islamic zones international development agencies Development Bank. The Brazilian- in the planning and development based mining company Vale and Nationally, the Nacala port is a of infrastructure for the SEZ, and Japanese investment house Mitsui key driver for infrastructure and has done this for port and railway are carrying out upgrades to the economic development. Capitalising infrastructure improvements. As railway line from Moatize near Tete on this opportunity, the central a central government agency, to Nacala-a-Velha SEZ. government has created an SEZ GAZEDA also has direct access covering the districts of Nacala- to the planning and development Upgrading the port and the Porto and Nacala-a-Velha to drive ministry and the public works formation of the SEZ has increased investment in infrastructure, department, with whom it can employment opportunities in the manufacturing, and industry near the effectively implement projects on formal sector in Nacala. Between port. The national Special Economic the ground (See Fig. 44). 2010 and 2013, over 5000 new Zones Office (GAZEDA) manages jobs were created in construction, the SEZ. The role of this agency is Financing for SEZ investments in engineering, manufacturing and to promote and manage investments infrastructure comes from private agro-industry (USAID, 2014). New in the Nacala SEZ. GAZEDA has investors as well as international industrial units are being set up, a number of policy instruments at development organisations. particularly on highway EN8 which its disposal to encourage private Upgrades to the Nacala dam and connects the city to Nampula and investment in the SEZ, including the city’s water supply system were forms part of the economic corridor special tax and customs agreements completed with USAID funding, enabling the linear growth of the and dispute resolution mechanisms. while upgrades to the electricity city in a southward direction. GAZEDA can coordinate directly system to the city were completed

Private Sector Central Government GAZEDA Policy formulation Finance Finance Development planning Some powers Development planning Determining needs International Land use determination Project implementation Finance Management of service Development Organisations

Local Government Determining local needs Prioritisation of needs Project implementation Management of service

Management of built/ Upgrading/building Improving existing services mega infrastructure investment climate

Service delivery Figure 44: Emerging service delivery model in Nacala to city residents

48 Future Proofing Cities | Growth Corridors in Mozambique

Strategic location and deep water port

Increased trade through the Nacala to export via Tanzania and South Port has brought prosperity to Africa. This added huge transport Nacala. Mozambique is going costs - in some cases up to a 56% through an economic boom driven surcharge (UN, 2014). Peace has by large inflows of Foreign Direct provided an opportunity to revitalise Investment (FDI) linked to natural the growth corridor linking Malawi resource exploitation, international to the rapidly expanding Nacala development assistance and Port. The Port is also one of the agriculture (ADB, 2011). Nacala principal gateways to the huge has one of the deepest natural natural resources of Tete, one of the ports on the eastern coast of most mineral-rich provinces in the Africa. The port was the gateway country. to landlocked Malawi for decades before the outbreak of civil conflict in Mozambique. During the 15 years of conflict, Malawi was forced

Figure 45: Nacala Port Credit: Boston Samalia - marinetraffic.com 49 Future Proofing Cities | Growth Corridors in Mozambique

Key Themes

High poverty Formal employment Skill development Over 50% of the population lives opportunities Privately funded skills-building below the poverty line, and a Port modernisation has resulted in large institutes are addressing the large proportion lives in informal opportunities for formal employment, skilled labour shortages in the settlements. evident through the relatively low port and in emerging industries informal sector presence in the city. in the SEZ.

Citizenship

Increased foreign investment Tourism hub Low local investment The SEZ has seen increased Nacala’s location on the coast and the The increased foreign foreign investment in the presence of many tourist attractions like investment in the SEZ has manufacturing, construction and beaches, coral reefs and ruins along the not been accompanied by an shipping sectors. northern coast make it an ideal location increase in local investment. as a tourist hub. Economy

SEZ formation Public-private partnership (PPP) Lack of local coordination The districts of Nacala Porto and law Municipal government does Nacala-Velha form the Nacala A pending PPP law at the national level not have the capacity or the Special Economic Zone, run by may be able to better direct the benefits institutional mandate for co- GAZEDA, a central government of large infrastructure projects that the ordinating planning with the agency. GAZEDA is able to SEZ undertakes. SEZ. better co-ordinate with the national government on a range of economic development and Governance infrastructure upgradation projects.

Poor service delivery Investment in large infrastructure Poor public health system The city experiences poor service As a result of private investment The city is vulnerable to delivery, particularly in solid and international donor funding, epidemics due to an under- waste collection, industrial waste large infrastructure investments like resourced and insufficent health disposal, and water supply. the Nacala dam upgrade and port care system. modernisation have been completed, bolstering the city’s capacity to provide Services services.

Sea level rise Water and soil pollution Coastal erosion The shores of Nacala Bay are The rise in a number of industries in Coastal erosion has already vulnerable to rising sea levels. the SEZ, along with low capacity for caused damage to buildings 75% of the city’s land area may managing environmental hazards, is along Nacala Bay and is be vulnerable to inundation due to manifesting in increased pollution of projected to increase with sea climate change. soil and water bodies. level rise.

Environment

50 Future Proofing Cities | Growth Corridors in Mozambique

Coral reefs, ruins and beaches like the one at Fernao Veloso located along the northern Mozambique coastline make Nacala a potential tourist hub

International Airport

Coal terminal A critical part of the port modernisation plan has been upgrading the coal terminal to accomodate coal transported from Tete

Nacala Port Ongoing modernisation of the port aims to fulfill Nacala’s potential as a shipping hub for eastern Africa

Coastal erosion occurs along the Nacala Bay Nacala Bay, causing damage to houses Nacala-a-Velha built close to the shoreline Informal housing Just like other Mozambican cities, high levels of informal housing characterise Nacala

Railway line The Tete-Nacala railway line is the primary component of the Nacala Nacala economic corridor, upgraded with funding from the mining company, Vale Emerging industries Investment in industries has increased since the formation of the Nacala SEZ and initiation of port modernisation

Nacala Dam, upgraded with funding from USAID and AfDB, located approximately 35 km south of the city To Nampula To Tete

Figure 46: Nampula map 51 Future Proofing Cities | Growth Corridors in Mozambique

Coral reefs, ruins and beaches like the one at Fernao Veloso located along the northern Mozambique coastline make Nacala a potential tourist hub

International Airport

Coal terminal A critical part of the port modernisation plan has been upgrading the coal terminal to accomodate coal transported from Tete

Nacala Port Ongoing modernisation of the port aims to fulfill Nacala’s potential as a shipping hub for eastern Africa

Coastal erosion occurs along the Nacala Bay Nacala Bay, causing damage to houses Nacala-a-Velha built close to the shoreline Informal housing Just like other Mozambican cities, high levels of informal housing characterise Nacala

Railway line The Tete-Nacala railway line is the primary component of the Nacala Nacala economic corridor, upgraded with funding from the mining company, Vale Emerging industries Investment in industries has increased since the formation of the Nacala SEZ and initiation of port modernisation

Nacala Dam, upgraded with funding from USAID and AfDB, located approximately 35 km south of the city To Nampula 0 1 2 4 km To Tete

52 Future Proofing Cities | Growth Corridors in Mozambique

Summary of environmental risks Three dimensions of environmental risk

Nacala’s location in a marshy area and susceptibility to cyclones and Climatic risk storms means flooding is the key The impact of climatic events on hazard for the city. urban populations, infrastructure and economies

Nacala was built in the 1960s on a drained swamp near Nacala Bay. A poorly maintained and inadequate drainage system that does not service the city’s population is compounding its natural exposure to flooding. The impact of rising sea levels is already felt in parts of the city with nearly 50% of the city’s area facing inundation. This figure is expected to rise to 75% due to sea level rise. Poor housing conditions is a major factor increasing risk to Nacala’s residents against a range of environmental threats and hazards. Nearly 70% of the city’s residents live in poorly serviced informal housing. Housing materials are of poor quality and Biological & natural do not provide adequate protection against high temperatures, storms, and wildfire. resource risk Addressing informality and poor housing The impact of scarcity or conditions will greatly reduce the risk from degradation of natural resources on urban populations and economies environmental threats.

Geophysical risk The impact of geophysical event on urban populations, infrastructure and economies

53 Future Proofing Cities | Growth Corridors in Mozambique

Types of threat or hazard, with current and estimated future risk rating Extreme temperature Storm Wildfire Drought Flood High frequency of storms, The city has a tropical climate Nacala is located on the Densely packed housing in A recent upgrade to the location in a marshy area, with an average temperature Mozambique Channel, which informal settlements, with a Nacala dam has augmented and poor drainage systems of 25°C, predicted to increase sees a high number of storms majority having palm leaf or city water supply in the short- increase Nacala’s risk against by 2-2.5°C rise by 2040 due and cyclones particularly thatched roofs increases the to-medium term. floods. The projected increase to climate change. Nearly during monsoons. The possibilty of the spread of in storms and cyclones due 70% of Nacala’s residents frequency of cyclones has wildfire. to climate change is expected live in informal housing with risen in the last twenty years, to worsen the future risk to poor construction quality, and expected to increase floods. exacerbating risk to residents. further as a result of climate change. Contamination Crop disease, Degradation Air quality or depletion of infestation or or depletion of Fuel scarcity degradation fresh water failure fisheries Increased investment in While sewage is treated The city does not rely on Fishing is a major economic 72% of households rely on industries and the presence before releasing into water agriculture as heavily as activity on Nacala’s coastline. oil, kerosene and paraffin for of a large coal terminal with bodies, mixing of industrial Nampula or Tete, but may In the absence of sound energy. Increased investment minimal enforcement of and domestic sewage renders be affected by crop failures environmental policy, there in the hydropower sector can environmental policies are the process ineffective. Nacala projected by climate change is a risk of fishing being help reduce the reliance on expected to worsen Nacala’s relies on streams and rivers models. affected by water pollution fossil fuels, if accompanied air quality. for drinking water supply, due to expanded shipping by improvement in the recently augmented by an and industrial activity, and city’s electricity distribution upgrade to the Nacala dam. overfishing. network.

Soil Raw materials contamination Mineral degradation or Loss of Vector-borne and erosion depletion scarcity biodiversity disease

There is already erosion Oil and natural gas discoveries There is little evidence for Water pollution off the Nacala Densely packed, poorly built occurring along Nacala north of Nacala have spurred raw material degradation or coast may cause biodiversity and maintained housing Bay, and this is expected to foreign investment in the scarcity around Nacala. losses, particularly as the city combined with poor healthcare worsen due to sea level rise. sector. Nacala’s growth relies industrialises in a context of infrastructure makes vector Informal housing built near on coal extraction in Tete, low environmental policy borne disease a significant the coastline is particularly where the size of coal reserves enforcement. threat to Nacala’s residents. susceptible to erosion. allays fears of mineral depletion.

Water-borne Air-borne disease disease

Poor sanitation systems, Densely packed housing and ineffective sewage treatment, poor health infrastructure are and poor housing conditions key contributors to significant in Nacala increase the risk risk of air-borne diseases. of water-borne diseases. During epidemics, healthcare infrastructure may not be able to manage the additional load.

Wave action Legend

Nacala’s land is highly Current Estimated susceptible to inundation, and risk future risk expected to worsen due to sea level rise. High proportion Low of residents in informal settlements near the coastline Medium exacerbate this risk. High

54 Future Proofing Cities | Growth Corridors in Mozambique

Future challenges

The growth of industries and port modernisation may overburden Nacala’s current sanitation and waste disposal systems, while sea level rise may severely impact its vulnerable coastal settlements

Managing integrated planning manufacturing units in the SEZ Sea level rise area. The SEZ’s specific mandate – Currently, Nacala City does not have to promote investment and capacity As a coastal city that was established the political mandate to develop to invest in large infrastructure through draining a tidal swamp, the integrated plans in collaboration projects – results in plans that run impact of climate change is most with the SEZ governing body, parallel to, but are not integrated discernible through sea level rise GAZEDA. While GAZEDA is able into local government plans. The in the Indian Ocean. Among the to coordinate and invite investment city government is currently not Mozambican coastal cities, Beira is for key infrastructure and economic involved in decision-making expected to be the most affected by development projects in the SEZ, regarding investments related to the sea level rise, but there are already its unique mandate and direct SEZs and how these impact on the visible signs of the impact of the rising access to the central government functioning of the city. At present, levels in Nacala (Cities Alliance, bypasses the need for collaboration the municipal and provincial 2015c). Sea level rise due to climate with Nacala City and Nampula governments in Nacala do not change is likely to pose a serious provincial government. Investment have the capacity to co-ordinate threat to the city and its important decisions in infrastructure effectively with GAZEDA, adding economic functions for the country. development are prioritised based a further challenge to the need for Coastal erosion is already increasing on key issues related to business close co-ordination. Efforts are and has already caused displacement interests – for example, rail and needed in institutional reform and and damage to houses in the city. Half port infrastructure that prioritises in capacity building at the local of the city’s land area is at high risk mining and warehousing, or water level to enable integrated planning from inundation during storms and supply and electricity projects that and collaboration between Nacala another quarter of the city’s area is address specific issues faced by City and the SEZs. likely to be at risk from sea level rise by the end of the 21st century.

Figure 47: Development in Nacala centre Figure 48: Eroded roads in Nacala Credit: olamocambique.wordpress.com Credit: Charlotte Mack - IDF International

55 Future Proofing Cities | Growth Corridors in Mozambique

Achieving inclusive economic changes, including higher minimum to the lack of sanitation facilities, growth wage levels, have increased overall particularly in informal settlements. costs without an improvement in Nacala has already benefited from productivity (USAID, 2014). The Nacala’s inadequate waste collection its strategic location and SEZ, with report also concluded that frequent and disposal practices will impact increased foreign investment in power outages and fluctuations have the health and wellbeing of its manufacturing, construction and tripled the effective cost of energy citizens. While the urban core sees shipping sectors. In fact, Nacala for many firms, along with damage nearly 100% waste collection, SEZ has dominated investment to sensitive equipment (USAID, coverage drops to around 35% in the and employment generation 2014). It is likely that the national peri-urban areas. A waste treatment among SEZs and Industrial Free and international investment in plant is located approximately 10 Zones (IFZs) in Mozambique. large energy and water projects in km outside the city but does not Annual investment in Nacala SEZ and around the SEZ area are not follow good management or safety comprised more than 85% of all accompanied by upgrades to the practices. Even after treatment, SEZ/IFZ investment for four of local distribution networks within the residue causes soil pollution. the six years between 2009 and the urban areas where these firms Industrial and household waste 2014. In the same period, the are located. is not necessarily separated, SEZ generated over 25,000 jobs constituting an even greater risk of (USAID, 2014). However, the Infrastructure deficits soil contamination. Waste water is SEZ faces human resource and similarly routed through a treatment infrastructure constraints. Labour Nacala is vulnerable to the risks plant, but the mixing of industrial intensive industries in the SEZ caused by poor sanitation in and domestic waste renders the are constraining the availability informal settlements and public waste-water treatment ineffective. of skilled labour locally. A 2014 health infrastructure. Nacala’s Mixing domestic and industrial USAID report on SEZs and IFZs coastal location makes it susceptible waste may also cause environmental in Mozambique found that all firms to cyclones and storms, a number pollution in the future, particularly interviewed by the team reported a of which have damaged buildings as Nacala experiences the shortage of skilled labour and low in the city. Poor housing and health anticipated scale of industrial productivity levels. In the absence infrastructure compound the impact growth related to the modernised of consistent and far-reaching of these natural disasters, resulting port and increased investment in the measures to improve skills and in diarrhoea and cholera epidemics. SEZ. education levels, recent policy The health challenges increase in the aftermath of storms, mainly due

Fihure 49: Employment in Nacala Figure 50: Peri urban housing and erosion in Nacala Credit: USAID Credit: USAID

56 Future Proofing Cities | Growth Corridors in Mozambique

Final Thoughts

What are the key determinants for the future of the three cities?

Emerging models of local try to address one or more urban attempts to overcome issues in a governance governance issues, they are not ideal low-finance, low-capacity context solutions. In Tete, private investment like Mozambique. These models Like most African cities, urban is leading quality housing and are moving towards empowering governance in the three cities service delivery provision without local governments in their own along the Nacala Corridor shares inclusiveness or the ability to ways, such as the formation of a common issues: lack of financial address environmental hazards. In provincial coordination agency capacity, lack of technical capacity, Nampula, collaborative partnerships (UCODIN) at the provincial level and fragmented governance. In this create limited technical and financial as in Nampula, or the creation of context, a growth corridor policy capacity for service delivery but do community development funds to where the central government is not empower local governments or finance local projects as in Tete. the main driver of development address fragmentation effectively. All three models should continue opportunities seems an appropriate In Nacala, the creation of a SEZ to focus on a partnership approach solution. enables a larger central role in with an overall objective to improve improving infrastructure and service local governance capacity. As the While challenges in local delivery that skips local government process of decentralisation continues governance capacity may slow participation. in Mozambique, new ideas for down improvements in local service empowering local governments delivery and economic growth in the The ability of cities to address present the best opportunity to growth corridor policy, innovative environmental risks in the future future proof these cities in the short service delivery models have begun relies on effective local governance to medium term. to meet the demand and fill the void models. The cities of Tete, Nampula in these cities. While these models and Nacala represent interesting

Fihure 51:Aerial view of Nampula Credit: photobucket.com

57 Future Proofing Cities | Growth Corridors in Mozambique

Low coverage of urban services infrastructure between Tete and lack of formal land title and tenure and infrastructure Nacala are being carried out with can be addressed through the 1997 funding from the private sector Land Law that establishes the The damage to major regional – the mining company Vale and secure, long-term use rights for transportation and energy investment house Mitsui – and land known as the DUAT. This may infrastructure during the long civil implemented through a public- open up opportunities to invest in war has resulted in poor quality of private-partnership. Upgrades to service delivery improvements at the urban services. The infrastructure the Cahora Bassa and Nacala dams municipal level. deficiencies remain evident more in the region have been carried out than two decades after the end of with funding from international the conflict. In spite of a wealth development organisations. of natural resources, the lack of infrastructure blocks the growth of To a large extent, upgrades to formal industries based on coal and energy, water supply, and transport iron ore. infrastructure have not been accompanied by an improvement Financial and institutional barriers in urban service provision within to the development of major cities. Major factors are the lack of infrastructure are being addressed financial and technical capacity in in a number of ways. The Nacala provincial and city governments corridor is primarily a logistics and the extent of the informality corridor. Upgrades to transportation of housing in urban centres. The

Figure 52: Nacala Credit: landolia.com

58 Future Proofing Cities | Growth Corridors in Mozambique

Vulnerability to climate change affecting hydroelectric generation particularly vulnerable to climate capacity – a major source of energy change. The Nacala port, which is a Mozambique is expected to be one in northern Mozambique. key driver of economic development of the worst-affected countries due in the city may be drastically to climate change. Sea level rise The major effects of climate change affected by sea level rise, while and coastal erosion will drastically occur primarily in the countryside the Cahora Bassa and Nacala dams affect its 2700 km long coastline, surrounding Tete and Nampula, may not be able to sufficiently meet where two-thirds of its population which have high rural populations rising energy demand, with lower and most of its infrastructure are primarily engaged in agriculture. water levels in the Zambezi River. located. In the hinterland, rising The loss of agricultural output may temperatures and changing rainfall increase rural-urban migration into patterns may increase the occurrence these cities. For Nacala, the impact of droughts. Of particular concern of climate change may be more is the projected 5-15% drop in direct, with sea level rise projected annual rainfall. A large majority to affect 75% of its area. of the population in Tete and Nampula provinces rely on rain- For cities with low urban service fed subsistence agriculture, which coverage and quality, increased may be severely impacted by the migration may exacerbate reduced rainfall. Reduced rainfall the existing situation. Large is also projected to lead to lower infrastructure investments in water levels in the Zambezi River, northern Mozambique seem

Figure 53: Cahora Bassa dam Credit: Josh Kirshner - Flickr

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Low carbon development initiative in Fig. 54. A full list For the most part, policy instruments of these initiatives is included in to promote low-carbon development Mozambique has seen significant Appendix B. exist in Mozambique. The DUAT economic growth since the law provides national and local transition to democracy in 1994. For a majority rural country governments with a powerful tool A low economic base and a which is dependent on subsistence for planning and land management number of avenues for sustained agriculture, the initiatives with the in the urban and rural context. economic growth presents an greatest impact involve agriculture. Through the Mining Act of 2014, the opportunity to mainstream low- Increasing farm productivity national government has displayed carbon emission development as can help address deforestation an intention to derive social benefits the basis for future growth. An and stem rural-urban migration. from coal mining, and can mandate Overseas Development Institute Integrated rural land-use planning low-emission policies in the (ODI) supported study analysed can also mediate between land for extraction and construction sectors. economic and environmental mining and agriculture. Effective, National policy on setting up SEZs factors in sub-Saharan Africa, and multi-use urban planning and the can also help incentivise the growth identified twenty long-term cross- promotion of mass transportation of low-emission manufacturing near sector transitions (or initiatives) will help address high levels of ports. that can promote a move to a low informality and prepare cities for carbon development pathway in continued population growth. Sub-Saharan Africa (Hogarth et Another set of ‘quick-wins’ involves al, 2015). Based on our research the extraction and manufacturing we have found that some of these industries, where low-carbon initiatives are more applicable to standards can set the foundation for Mozambique than others. We have long-term, sustainable low-carbon summarised the most relevant development.

Reduce demand Diffuse climate- Integrate Implement higher Strengthen the use for agricultural smart agriculture rural land-use density multi-use of energy efficient land by intensifying practices planning urban plans processes and production and technologies in the reducing post-harvest extractives sector waste

Figure 54: Key initiatives for low-carbon development along growth corridors in Mozambique

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Appendix

61 Future Proofing Cities | Growth Corridors in Mozambique

A. Information mapping

Tete Nampula Nacala Overall We followed a subjective process Citizenship to assess the information that was immediately available for each city. Participation Information was supplied by Cities Social capital Alliance and Future Cities Africa Community awareness and teams. Arup carried out a global preparedness information scan to identify whether Civil rights and justice any gaps could be readily filled with open-source information. We Economy applied a rating to this information Human capital according to quality and availability of data or information on each Institutional environment sub-dimension within the revised External macro environment normative framework. Industry For Mozambique overall, Outputs information on governance, economy, and services was Governance moderately available although there Enabling environment was a lack of information in specific Municipal finance areas such as representation and Representation and accountability in local governance accountability and emergency services. More Municipal capacity broadly, information with respect to both citizenship and environmental Risk management services was generally lacking in Planning Tete, Nampula, and Nacala. Services Social services Basic services Economic services Emergency services Environment Protective ecosystem services Regulating ecosystem services Natural resources Legend Cultural ecosystem services

High A substantial amount of information that is sufficiently detailed enough to use in further analysis work Moderate An average amount of information of adequate detail. Information may require interpretation for further analysis work. Additional research is suggested.

Low A limited amount of information, or information of low quality or partially available information. More research is recommended. No data No data was initially supplied by Cities Alliance or Future Cities Africa team. A reasonable amount of time was spent looking for additional open-source information and none was readily available for the city.

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B. Low-carbon development initiatives mapping

Building on the in-depth sector analysis, ODI identified 20 long-term cross- Legend Potential for supporting sector transitions (or initiatives) that can be undertaken to promote low-carbon low-carbon economic development in Sub-Saharan Africa (SSA). To rank and score these initiatives, development they developed a preliminary methodology using a set of four criteria: (1) the level of GHG emissions that they could avoid; (2) the risk of lock-in High that they could avert; (3) their contribution to increased productivity; and Medium (4) their contribution to poverty reduction. These initiatives were scored as having high, medium or low potential in promoting low-carbon development. Low Based on research carried out for this report we have provided a qualitative comparative score based on country specific knowledge.

Cross-sector transitions /

initiatives SSA Moz. Why is it relevant in Mozambique? What is the opportunity in Mozambique? Agriculture Majority of the population in northern Mozambique Northern Mozambique already has parastatals that provide Reduce demand for relies on subsistence agriculture. Low-productivity from support to rural households on training, technology and access agricultural land by agriculture has been identified as a key cause for soil to finance to enable the transition to commercial agriculture. erosion, land degradation and deforestation, and as a intensifying production and The Nacala corridor will enable easier access to markets and barrier to economic growth in rural areas, leading to high reducing post-harvest waste ports through improved transport, reducing post-harvest waste. rates of rural-urban migration. Reduce emissions from No evidence of relevance No evidence of opportunities livestock Majority of the population in northern Mozambique Northern Mozambique already has parastatals that provide relies on subsistence agriculture. Low-productivity from support to rural households on training, technology and access Diffuse climate-smart agriculture has been identified as a key cause for soil to finance to enable the transition to commercial agriculture. erosion, land degradation and deforestation, and as a agriculture practices The Nacala corridor will enable easier access to markets and barrier to economic growth in rural areas, leading to high ports through improved transport, reducing post-harvest waste. rates of rural-urban migration. Forestry Better land-use and land management practices can help Land-use planning is centralised at the national level reduce rural-urban migration, reduce pressure on already due to the DUAT law. In rural areas particularly in Tete stretched urban services. Some planning powers have been Integrate rural land-use province, the lack of integrated land-use planning has decentralised to the provincial government, which can enable resulted in contestation for fertile land between mining planning better coordination of rural and urban planning. The DUAT interests and agriculture. A key source of population law can be an important policy tool to enable better rural land- growth in cities is rural-urban migration use planning. Deforestation is a significant environmental risk driver, Development finance instruments such as REDD+ incentivise Capture the value of forests’ particularly around the city of Nampula. Key factors for forest conservation. Ecotourism is one of the fastest growing deforestation include increasing agricultural coverage ecosystems services sub-sectors under tourism. and use of firewood for fuel. Energy Formalise the charcoal Switching to more efficient and reliable sources of energy industry, and promote A majority of the urban households in the three cities will reduce environmental damage in urban and rural reviewed for this report relies on candles, kerosene and areas. Mozambique has seen a lot of investment in energy efficient charcoal kilns and wax for energy. Rural areas primarily use firewood, a key production, particularly around upgrading hydropower plants. biomass cook-stoves, and cause for deforestation. Improvements in energy distribution systems can enable a shift fuel switching away from firewood and carbon-heavy sources of fuel. Coal mining is a key driver of economic growth in Generate on-grid electricity Mozambique, and expected to drive growth in the near future. Economic growth has been accompanied with increasing from renewable sources While large coal reserves may render renewable sources demand for energy, particularly as new industrial plants unfeasible, worldwide coal demand is dropping and the and prevent lock-in of coal emerge around Nampula and Nacala. power country will need to plan a shift to renewables in middle-to- long-term. Coal mining is a key driver of economic growth in Mozambique, and expected to drive growth in the near future. Promote electricity access Economic growth has been accompanied with increasing While large coal reserves may render renewable sources demand for energy, particularly as new industrial plants from off-grid and mini-grid unfeasible, worldwide coal demand is dropping and the emerge around Nampula and Nacala. systems in rural areas country will need to plan a shift to renewables in middle-to- long-term.

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Legend Transport Mozambique does not have income-targeted fuel subsidies. A World Bank study identified that fuel use is higher among richer households, who consequently derive more benefit Large coal reserves and the discovery of coastal deposits Remove fossil fuel subsidies from fuel subsidies - 30% of fuel subsidies benefit the highest of natural gas and crude oil in the north suggest that the quintile by income, whereas 14% of fuel subsidies benefit the for consumption country might rely heavily on fossil fuels for energy lowest quintile. Income-targeted subsidies might be suitable considering the lack of reliable energy options for low income households in the short term and phased out in the long term. While the automobile industry is seeing growth in Shift to a low-carbon Mozambique has a low car ownership rate with only Mozambique, most production is export-oriented and may be about 4% of all households in Mozambique owning cars automobile fleet and fuels meeting international standards for carbon emissions A majority of urban households live in dense and Effective planning and implementation will help Mozambique Implement higher density poorly serviced informal settlements on the outskirts of widely deliver the benefits of economic growth to communities cities. National policy sees urban centres as drivers of in informal settlements, provide improved living conditions for multi-use urban plans economic growth, and high urban population growth is future urban migrants, and lay the foundation for a low-carbon expected over the next few decades. emissions in cities. A majority of urban households live in dense and An increase in per capita incomes will be accompanied by an poorly serviced informal settlements on the outskirts of Promote mass increasing demand for cars, and planning mass transportation cities. National policy sees urban centres as drivers of systems now will enable cities to manage transportation transportation systems economic growth, and high urban population growth is demand effectively. expected over the next few decades. Extractives

Strengthen the use of A large proportion of coal mines in Tete are open-pit mines energy efficient processes Mining is expected to be a signficant contributor to which have lower extraction costs than shaft mines. In spite and technologies in the Mozambique’s economy in the near future. of high transport costs, it may be financially feasible to extractives sector incorporate energy efficient processes Switch to lower carbon fuel sources and renewable Mining is expected to be a signficant contributor to Hydroelectricity is already a major energy source in energy in the extractives Mozambique’s economy in the near future. Mozambique sector Mining and oil extraction are not subsidised in the country. On Remove and avoid subsidies Mining is expected to be a signficant contributor to the other hand, mining fees and revenue sharing arrangements for fossil fuel production Mozambique’s economy in the near future. with extractive industries are a key source of government revenue. Construction Construction is driven by industrial demand, whether the Reduce emissions from construction of housing for mining employees in Tete and High economic growth has been accompanied by a Moatize, or the upgradation of Nacala port. It may be easier construction materials and construction boom to incentivise and implement low-emission methods in methods construction, and influencing a few large construction projects can derive a disproportionately large benefit. National level criteria on low-emission operations that guide local building codes can be implemented in Mozambique’s Reduce emissions from With increasing incomes across Mozambique, energy policy landscape. Many low-emission operational initiatives consumption in buildings is projected to be higher. buildings operations such as solar heating for hot water also help reduce operational costs for buildings. Manufacturing Increase use of energy Heavy manufacturing is driven by a few multinational efficient processes organisations whether in mineral processing, crude oil refining Industrialisation is picking up along growth corridors, or metal processing. The impact of implementing energy and technologies and particularly ports like Nacala, Beira and Maputo clean energy in heavy efficient processes can be high considering implementation does not involve many actors in this sector. manufacturing Light manufacturing, while being a low-emission option, Drive growth in light Industrialisation is picking up along growth corridors, can be a significant contributor to inclusive growth for the particularly ports like Nacala, Beira and Maputo manufacturing primarily agriculture-reliant economy National policy already focuses on driving industrial growth Develop low-carbon Industrialisation is picking up along growth corridors, through the provision of fiscal regulations in SEZs and IFZs. products particularly ports like Nacala, Beira and Maputo These fiscal incentives for production can be directed to industries that produce low-carbon products.

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