Identifier
Created
Classification
Origin
06MAPUTO1545
2006-11-30 04:50:00
UNCLASSIFIED
Embassy Maputo
Cable title:
U.S. - Mozambique Trade Investment Framework
how-toVZCZCXRO2094 RR RUEHBZ RUEHDU RUEHJO RUEHMR RUEHRN DE RUEHTO #1545/01 3340450 ZNR UUUUU ZZH R 300450Z NOV 06 FM AMEMBASSY MAPUTO TO RUEHC/SECSTATE WASHDC 6498 INFO RUCNSAD/SOUTHERN AFRICAN DEVELOPMENT COMMUNITY RUEHLMC/MILLENNIUM CHALLENGE CORP 0124 RUCPDOC/DEPT OF COMMERCE WASHDC RUEHC/DEPT OF LABOR WASHDC
UNCLAS SECTION 01 OF 03 MAPUTO 001545
SIPDIS
SIPDIS
AF/S FOR HTREGER AND JMALONEY
USTR FOR PCOLEMAN
JOHANNESBURG TDA FOR DSHUSTER
USDOC FOR RTELCHIN
MCC FOR SGAULL
USAID FOR AA/AFR AND AFR/SA
E.O. 12958: N/A
TAGS: ECON EAID EINV ETRD MZ
SUBJECT: U.S. - Mozambique Trade Investment Framework
Council Talks
MAPUTO 00001545 001.2 OF 003
--------
SUMMARY
--------
UNCLAS SECTION 01 OF 03 MAPUTO 001545
SIPDIS
SIPDIS
AF/S FOR HTREGER AND JMALONEY
USTR FOR PCOLEMAN
JOHANNESBURG TDA FOR DSHUSTER
USDOC FOR RTELCHIN
MCC FOR SGAULL
USAID FOR AA/AFR AND AFR/SA
E.O. 12958: N/A
TAGS: ECON EAID EINV ETRD MZ
SUBJECT: U.S. - Mozambique Trade Investment Framework
Council Talks
MAPUTO 00001545 001.2 OF 003
--------------
SUMMARY
--------------
1. (U) Summary. Assistant United States Trade
Representative (AUSTR) Florizelle Liser led an interagency
visit to Mozambique October 16 through October 18. The
purpose of the visit was to conduct the first bilateral
Council on Trade and Investment (TIFA Council) under the
Trade Investment Framework Agreement (TIFA) signed in June
2005. In addition to the TIFA Council meeting, the
delegation held bilateral talks, a joint press conference
with the Minister of Industry and Commerce and met with the
private sector to discuss trade facilitation and business
environment issues. The delegation included USTR Director
for African Affairs Patrick Coleman, Millennium Challenge
Corporation Country Director Stephen Gaull, Department of
Commerce Pretoria Senior Commercial Officer Craig Allen,
U.S. Trade and Development Agency Manager for Sub-Saharan
Africa Doug Shuster, USDA Pretoria Agricultural Counselor
Scott Reynolds, and State/AF/EPS Officer Janet Potash.
During the TIFA Council the TIFA Workplan was reviewed and a
joint summary of the meeting agreed upon. End Summary.
--------------
THE TIFA COUNCIL
--------------
2. (U) On October 16, AUSTR Liser and Mozambique's Minister
of Industry and Commerce, Antonio Fernando, opened the
bilateral TIFA Council, both stressing the bilateral trade
potential between the United States and Mozambique, progress
made to date on the business environment in Mozambique and
the desire of both parties to continue Mozambique's economic
growth through bilateral cooperation and assistance.
3. (U) After the opening remarks AUSTR Liser and Ana Maria
Raquel, Permanent Secretary, Ministry of Industry and
Commerce, shared positions on Doha, with the AUSTR
encouraging Mozambique to take a more active role in the
World Trade Organization. Following the Doha discussion,
the MCC's Stephen Gaull and Emilio Muchanga, Head of the
Mozambican government's MCC Technical Unit then presented an
update and trade-related highlights of progress towards a
MCC Compact with Mozambique.
4. (U) The bilateral team reviewed the TIFA Workplan, as
well as progress made in implementing the TIFA, highlighting
programs and reforms undertaken by Mozambique as well as
technical assistance and programs implemented by the United
States. A USAID Maputo representative emphasized USAID's
activities supporting and improving the environment for
investment and trade, including long-term technical
assistance, capacity building and sector-specific programs.
5. (U) During the closing session of the TIFA Council,
AUSTR Liser emphasized the importance of focusing on
specific key sectors and/or products for export development
and assistance and the opportunities provided under AGOA for
processed products. (Note. AGOA offers greater margins for
processed products, as opposed to raw products, as non-AGOA
countries generally face higher tariffs on processed
products. End note.) Minster Fernando stressed
Mozambique's need for greater technical assistance,
including assistance in identifying and supporting
appropriate sectors and products for the regional and US
markets.
6. (U) At the conclusion of the TIFA Council on the
afternoon of October 17, AUSTR Liser announced a USD 750,000
program focused on facilitating and simplifying trade in
Mozambique via streamlining the import and export process.
This program, funded under the President's African Global
Competitiveness Initiative and implemented by USAID, aims to
cut import and export times in half within two years.
7. (U) Immediately following the TIFA Council meetings,
AUSTR Liser and Minister Fernando held a well-attended joint
press briefing that resulted in several media reports on the
TIFA Council and US trade-related support to Mozambique.
-------------- --
MAPUTO 00001545 002.2 OF 003
PRIVATE SECTOR ROUNDTABLE AND IPR PRESENTATION
-------------- --
8. (U) During the afternoon of October 16, AUSTR Liser and
Permanent Secretary Raquel led a bilateral roundtable with
the private sector to discuss investment promotion and the
business environment. The roundtable was well attended by
members of the private sector, who raised general
observations regarding doing business in Mozambique and an
overall desire to increase exports, including to the United
States.
9. (U) Lance Khumalo, General Director of Unilever
Mozambique and Fernando Santos of the Mozambican
Intellectual Property Institute each gave a presentation on
the status of the protection of Intellectual Property Rights
(IPR) in Mozambique. Both stressed the importance and
effectiveness of the IPR Task Force, a joint endeavor by the
private sector and government, in addressing ongoing IPR
issues. The cross-functional taskforce is comprised of the
Ministry of Industry and Commerce, Ministry of Finance,
Ministry of Interior, Ministry of Justice, Trade Marks
Office, a private law farm and representatives from the
private sector.
-------------- --
BILATERAL MEETING AND DINNER WITH THE MINISTER
-------------- --
10. (U) On the evening of the October 16 the Ministry of
Industry and Commerce hosted a dinner for both delegations
following a bilateral meeting between AUSTR Liser and
Minister Fernando. Charge d'Affaires Elizabeth Raspolic and
Patrick Coleman also participated in the bilateral. During
the bilateral meeting, Minister Fernando and AUSTR Liser
reviewed the TIFA Council discussions that occurred during
the day, including progress on the workplan. AUSTR Liser
also reported on her discussions that day with the
Mozambican private sector. The dinner party included all
members of both delegations as well as working level
representatives from the Ministry of Industry and Commerce
and the US Mission, creating an opportunity to discuss trade
and investment issues in a more informal environment while
strengthening working relationships.
--------------
BILATERAL MEETING WITH PRIME MINISTER DIOGO
--------------
11. (U) On the morning of October 17 AUSTR Liser and Deputy
Chief of Mission James Dudley attended a bilateral meeting
with Mozambican Prime Minister Luisa Diogo and Minister
Fernando. AUSTR Liser noted that the United States has
TIFAs with only a few key countries in Africa and emphasized
the importance of identifying specific sectors and products
for export development and assistance. AUSTR Liser also
mentioned the presentation she received on IPR issues and
suggested that President Guebuza and Minster Fernando could
use their pending visit to China to stress the problems
presented by Chinese counterfeit products in Mozambique.
12. (U) Prime Minister Diogo praised USAID's support of
CTA, the umbrella organization representing the private
sector in Mozambique. She also mentioned her hope that AGOA
would be extended by the US Congress and stressed that
Mozambique is on a positive path, citing macroeconomic
stability, low inflation, a successful currency change, and
the government's steps towards disaster readiness.
-------------- --------------
PRIVATE SECTOR MEETINGS, SITE VISITS AND CCMUSA LUNCH
-------------- --------------
13. (U) After the meeting with the Prime Minister, AUSTR
Liser and the delegation visited the Port of Maputo and met
with the port concessionaire Maputo Port Development Company
(MPDC). Peter Lowe, CEO of MPDC, gave a presentation to the
delegation highlighting the progress made at the port since
MPDC took over operations in 2003. However, he also
emphasized the strain recent governmental decisions
regarding scanning and the cost recovery plan to pay for
scanning operations have placed on the private sector. He
MAPUTO 00001545 003.2 OF 003
stressed his concern that the current situation would
translate into decreased trade flow through Mozambique and
eventual closure of the port. (Note. Additional
information regarding the scanning debate in Mozambique will
follow septel.) In addition, Mr. Lowe discussed the
critical role of the Maputo Corridor, which extends from
Mpumalanga Province in South Africa to the Port of Maputo,
in increasing trade and the need for a twenty-four hour
border and rehabilitated railway line.
14. (U) After the port of Maputo, the delegation visited
Maputo Clothing Company, the only apparel company in
Mozambique currently exporting to the United States under
AGOA. Frank Roomer, CEO of Maputo Clothing Company, shared
his belief that it is possible to successfully make apparel
in Mozambique, but that there is a need to simplify customs
procedures and to diversify market outlets both regionally
and in the United States.
15. (U) The Mozambican-American Chamber of Commerce
(CCMUSA) hosted a lunch for the delegation, allowing AUSTR
Liser and delegation members to hear from Mozambican
businessmen and women regarding their individual
experiences. Henk Son, President of CCMUSA, expressed the
importance of the bilateral relationship and US technical
assistance in Mozambique's continued economic growth. A
recurring theme throughout the lunch was the difficulty
faced by Mozambican businesses in identifying appropriate
sectors and products for export and the need for greater
technical assistance and support in securing committed
purchasers.
--------------
COMMENT
--------------
16. (U) The TIFA Council, bilateral meetings and private
sector interaction reinforced the ongoing positive business
and trade relationship between the United States and
Mozambique. AUSTR Liser utilized this visit to stress the
importance of Mozambique's continued commitment to improving
the business environment and the critical assistance
provided by the United States to help ensure progress and
success. Mozambique's stated commitment to increasing
exports was exemplified by its progress on several TIFA
Workplan elements and its desire to continue the working
relationship with the United States and its agencies on
capacity and technical issues. As evidenced by existing
concerns within the private sector, there is still much more
work to be done; there is little doubt however that the
United States will continue to support Mozambique in its
efforts to move forward. End Comment.
17.(U) USTR has cleared this cable in draft.
Dudley
SIPDIS
SIPDIS
AF/S FOR HTREGER AND JMALONEY
USTR FOR PCOLEMAN
JOHANNESBURG TDA FOR DSHUSTER
USDOC FOR RTELCHIN
MCC FOR SGAULL
USAID FOR AA/AFR AND AFR/SA
E.O. 12958: N/A
TAGS: ECON EAID EINV ETRD MZ
SUBJECT: U.S. - Mozambique Trade Investment Framework
Council Talks
MAPUTO 00001545 001.2 OF 003
--------------
SUMMARY
--------------
1. (U) Summary. Assistant United States Trade
Representative (AUSTR) Florizelle Liser led an interagency
visit to Mozambique October 16 through October 18. The
purpose of the visit was to conduct the first bilateral
Council on Trade and Investment (TIFA Council) under the
Trade Investment Framework Agreement (TIFA) signed in June
2005. In addition to the TIFA Council meeting, the
delegation held bilateral talks, a joint press conference
with the Minister of Industry and Commerce and met with the
private sector to discuss trade facilitation and business
environment issues. The delegation included USTR Director
for African Affairs Patrick Coleman, Millennium Challenge
Corporation Country Director Stephen Gaull, Department of
Commerce Pretoria Senior Commercial Officer Craig Allen,
U.S. Trade and Development Agency Manager for Sub-Saharan
Africa Doug Shuster, USDA Pretoria Agricultural Counselor
Scott Reynolds, and State/AF/EPS Officer Janet Potash.
During the TIFA Council the TIFA Workplan was reviewed and a
joint summary of the meeting agreed upon. End Summary.
--------------
THE TIFA COUNCIL
--------------
2. (U) On October 16, AUSTR Liser and Mozambique's Minister
of Industry and Commerce, Antonio Fernando, opened the
bilateral TIFA Council, both stressing the bilateral trade
potential between the United States and Mozambique, progress
made to date on the business environment in Mozambique and
the desire of both parties to continue Mozambique's economic
growth through bilateral cooperation and assistance.
3. (U) After the opening remarks AUSTR Liser and Ana Maria
Raquel, Permanent Secretary, Ministry of Industry and
Commerce, shared positions on Doha, with the AUSTR
encouraging Mozambique to take a more active role in the
World Trade Organization. Following the Doha discussion,
the MCC's Stephen Gaull and Emilio Muchanga, Head of the
Mozambican government's MCC Technical Unit then presented an
update and trade-related highlights of progress towards a
MCC Compact with Mozambique.
4. (U) The bilateral team reviewed the TIFA Workplan, as
well as progress made in implementing the TIFA, highlighting
programs and reforms undertaken by Mozambique as well as
technical assistance and programs implemented by the United
States. A USAID Maputo representative emphasized USAID's
activities supporting and improving the environment for
investment and trade, including long-term technical
assistance, capacity building and sector-specific programs.
5. (U) During the closing session of the TIFA Council,
AUSTR Liser emphasized the importance of focusing on
specific key sectors and/or products for export development
and assistance and the opportunities provided under AGOA for
processed products. (Note. AGOA offers greater margins for
processed products, as opposed to raw products, as non-AGOA
countries generally face higher tariffs on processed
products. End note.) Minster Fernando stressed
Mozambique's need for greater technical assistance,
including assistance in identifying and supporting
appropriate sectors and products for the regional and US
markets.
6. (U) At the conclusion of the TIFA Council on the
afternoon of October 17, AUSTR Liser announced a USD 750,000
program focused on facilitating and simplifying trade in
Mozambique via streamlining the import and export process.
This program, funded under the President's African Global
Competitiveness Initiative and implemented by USAID, aims to
cut import and export times in half within two years.
7. (U) Immediately following the TIFA Council meetings,
AUSTR Liser and Minister Fernando held a well-attended joint
press briefing that resulted in several media reports on the
TIFA Council and US trade-related support to Mozambique.
-------------- --
MAPUTO 00001545 002.2 OF 003
PRIVATE SECTOR ROUNDTABLE AND IPR PRESENTATION
-------------- --
8. (U) During the afternoon of October 16, AUSTR Liser and
Permanent Secretary Raquel led a bilateral roundtable with
the private sector to discuss investment promotion and the
business environment. The roundtable was well attended by
members of the private sector, who raised general
observations regarding doing business in Mozambique and an
overall desire to increase exports, including to the United
States.
9. (U) Lance Khumalo, General Director of Unilever
Mozambique and Fernando Santos of the Mozambican
Intellectual Property Institute each gave a presentation on
the status of the protection of Intellectual Property Rights
(IPR) in Mozambique. Both stressed the importance and
effectiveness of the IPR Task Force, a joint endeavor by the
private sector and government, in addressing ongoing IPR
issues. The cross-functional taskforce is comprised of the
Ministry of Industry and Commerce, Ministry of Finance,
Ministry of Interior, Ministry of Justice, Trade Marks
Office, a private law farm and representatives from the
private sector.
-------------- --
BILATERAL MEETING AND DINNER WITH THE MINISTER
-------------- --
10. (U) On the evening of the October 16 the Ministry of
Industry and Commerce hosted a dinner for both delegations
following a bilateral meeting between AUSTR Liser and
Minister Fernando. Charge d'Affaires Elizabeth Raspolic and
Patrick Coleman also participated in the bilateral. During
the bilateral meeting, Minister Fernando and AUSTR Liser
reviewed the TIFA Council discussions that occurred during
the day, including progress on the workplan. AUSTR Liser
also reported on her discussions that day with the
Mozambican private sector. The dinner party included all
members of both delegations as well as working level
representatives from the Ministry of Industry and Commerce
and the US Mission, creating an opportunity to discuss trade
and investment issues in a more informal environment while
strengthening working relationships.
--------------
BILATERAL MEETING WITH PRIME MINISTER DIOGO
--------------
11. (U) On the morning of October 17 AUSTR Liser and Deputy
Chief of Mission James Dudley attended a bilateral meeting
with Mozambican Prime Minister Luisa Diogo and Minister
Fernando. AUSTR Liser noted that the United States has
TIFAs with only a few key countries in Africa and emphasized
the importance of identifying specific sectors and products
for export development and assistance. AUSTR Liser also
mentioned the presentation she received on IPR issues and
suggested that President Guebuza and Minster Fernando could
use their pending visit to China to stress the problems
presented by Chinese counterfeit products in Mozambique.
12. (U) Prime Minister Diogo praised USAID's support of
CTA, the umbrella organization representing the private
sector in Mozambique. She also mentioned her hope that AGOA
would be extended by the US Congress and stressed that
Mozambique is on a positive path, citing macroeconomic
stability, low inflation, a successful currency change, and
the government's steps towards disaster readiness.
-------------- --------------
PRIVATE SECTOR MEETINGS, SITE VISITS AND CCMUSA LUNCH
-------------- --------------
13. (U) After the meeting with the Prime Minister, AUSTR
Liser and the delegation visited the Port of Maputo and met
with the port concessionaire Maputo Port Development Company
(MPDC). Peter Lowe, CEO of MPDC, gave a presentation to the
delegation highlighting the progress made at the port since
MPDC took over operations in 2003. However, he also
emphasized the strain recent governmental decisions
regarding scanning and the cost recovery plan to pay for
scanning operations have placed on the private sector. He
MAPUTO 00001545 003.2 OF 003
stressed his concern that the current situation would
translate into decreased trade flow through Mozambique and
eventual closure of the port. (Note. Additional
information regarding the scanning debate in Mozambique will
follow septel.) In addition, Mr. Lowe discussed the
critical role of the Maputo Corridor, which extends from
Mpumalanga Province in South Africa to the Port of Maputo,
in increasing trade and the need for a twenty-four hour
border and rehabilitated railway line.
14. (U) After the port of Maputo, the delegation visited
Maputo Clothing Company, the only apparel company in
Mozambique currently exporting to the United States under
AGOA. Frank Roomer, CEO of Maputo Clothing Company, shared
his belief that it is possible to successfully make apparel
in Mozambique, but that there is a need to simplify customs
procedures and to diversify market outlets both regionally
and in the United States.
15. (U) The Mozambican-American Chamber of Commerce
(CCMUSA) hosted a lunch for the delegation, allowing AUSTR
Liser and delegation members to hear from Mozambican
businessmen and women regarding their individual
experiences. Henk Son, President of CCMUSA, expressed the
importance of the bilateral relationship and US technical
assistance in Mozambique's continued economic growth. A
recurring theme throughout the lunch was the difficulty
faced by Mozambican businesses in identifying appropriate
sectors and products for export and the need for greater
technical assistance and support in securing committed
purchasers.
--------------
COMMENT
--------------
16. (U) The TIFA Council, bilateral meetings and private
sector interaction reinforced the ongoing positive business
and trade relationship between the United States and
Mozambique. AUSTR Liser utilized this visit to stress the
importance of Mozambique's continued commitment to improving
the business environment and the critical assistance
provided by the United States to help ensure progress and
success. Mozambique's stated commitment to increasing
exports was exemplified by its progress on several TIFA
Workplan elements and its desire to continue the working
relationship with the United States and its agencies on
capacity and technical issues. As evidenced by existing
concerns within the private sector, there is still much more
work to be done; there is little doubt however that the
United States will continue to support Mozambique in its
efforts to move forward. End Comment.
17.(U) USTR has cleared this cable in draft.
Dudley