Poverty in Mozambique | The policies that have been implemented to alleviate poverty | | | | | | |

TABLE OF CONTENTS 1.0 Introduction 3
2.0 Factors that have contributed to the rising of poverty levels in Mozambique 4 1) The Mozambican civil war 4 2) The effect of floods, drought and cyclones on poverty levels of Mozambique 5
3.0 The polices aimed at reducing poverty 6 1) Economic and Social Rehabilitation program (ESRP) 6 2) Strategy For Development of Small and Medium sized Enterprises 6 3) Master Plan: Director Plan for Prevention and Mitigation of Natural Disasters 7 4) Strategic Plan for Agricultural Development (PEDSA) 7
4.0The challenges faced by the proposed policies 7
Conclusion 8
Bibliography

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1.0 INTRODUCTION
Mozambique was a Portuguese colony and later became a member state of Portugal. It gained independence from Portugal in 1975. This was a time of celebration for the people of Mozambique after their decade long struggle for freedom; they looked forward to a bright new future. The new state the Fiente de Libertacao [FRELIMO] was under Samora Machel leadership and the government planned to put into practice a form of people’s democracy in which was a one party system. They envisioned a state that would wipe exploitation and release the creativeness of the masses and the productive forces. (Robinson, 2006). Barely two years after independence the country was faced with civil war, this war a proxy war of the cold war. The war left the country in complete disarray. Millions of people fled and some were killed and this left the political, economic and social structure of the country in shambles. The wars, political instability later floods were the major contributors of poverty in Mozambique.
Mozambique is among the world’s 20 poorest countries, it is ranked 175 out of 179 countries. (UNICIEF) The first section of this paper will discuss the above mentioned problems and their contribution to poverty levels in Mozambique and the second section will look at different policies which have been put into place to try and alleviate poverty and the third section will be discussing the problems encountered in carrying out the policies which have been mentioned in the second section.

2.0 Factors that have contributed to the rising of poverty levels in Mozambique
2.1 The Mozambican civil war
The Resistanca Nacional de Mozambique [RENAMO] which was led by Andre Matsangaissa was a political movement which was created by Rhodesia now Zimbabwe and later supported by the South African government to put an end to the guerrilla fighters in South Africa and Rhodesia. This new political movement opposed the FRELIMO government and had support from the South African government to fight FRELIMO. (Robinson, 2006)
The country was also caught in between the cold war in which RENAMO had the support of Western countries and FRELIMO was backed by the Soviet Union and other communist states. There were a lot of huge arms sent to Mozambique to both sides involved and a lot of lives were lost. (Robinson, 2006) The loss in lives meant that there was a reduction in human capital (labour) and the economy suffered a lot. Those who survived fled to other countries and some to city centres where there was a lot of congestion and over population which led to shortage in food and also led to poor living conditions. The poor living conditions and low standards of living led to diseases such as cholera, bilharzias. (Chan, Venancio, Alden, & Barnes, 1998) This meant that the government had to inject money into health services (money it did not have) to try and control the situation which further worsened the economic situation, as this money could have been used to rebuild the economy (Foley, 2007). RENAMO was based in the rural area and they bombed a lot of bridges and destroyed sugar cane plantations, they also bombed a lot of electrical substations in many parts of the country. (Dava, Chigora, Chibanda, & Sillah, 2013). Most of the arable land was infested with land mines and Mozambique’s greater portion of the G.D.P is generated through agriculture, loss of arable land had a great impact on the economy and the rural areas were the ones which were greatly affected. There was also a lot of destruction to infrastructure. The damage that was done to the road hindered easy movement of goods and services from cities to those places outside the cities. This also prevented goods that were for exportation from going out, as the roads were bad. (Robinson, 2006)
When the war finally ended in 1992 it had left devastating results behind. There was so much destruction, which had left the country in a poor economic situation and this was because the infrastructure for economic development had been destroyed. The shipping industry which was a way to stimulate economic growth had also failed to do so because of the conflicts. Investors were also discouraged to invest in Mozambique because of these wars. (Dava, Chigora, Chibanda, & Sillah, 2013)
2.2 The floods, drought and cyclones
Mozambique is one of the countries in southern Africa that is mostly severely affected by natural disasters. The economy is largely dependent on agriculture; communities rely on fishing and livestock keeping and rain-fed farming. Destruction to crops from extreme weather conditions threatens the food security, health and economic stability. Mozambique often faces droughts, floods and cyclones. The worst drought recorded was between 1980 and 1983 which left Mozambique on its knees; it had crippled the agricultural industry and left Mozambique reliant on food aid. (Foley, 2007)
The worst floods were those in 2000 and 2001 which affected close to 4.5 million people. 75% of people in Mozambique rely on small scale farming as a source of food and income and the most fertile lands are locate near the rivers and natural resources of water, so when floods hit they wipe out everything leaving people with no means on income. (Foley, 2007) These floods also left 300 000-500 000 people without homes. These floods also closed approximately 630 schools; this is about 214 000 pupils who were left without schools; 42 health units including Beira Central Hospital which is the second largest hospital in the country. It is also believed that these floods cost 20% of the country’s gross national product and slowed its economic growth by 2.1% (Foley, 2007).
Whenever the country is in process of recovering from one disaster it is hit by yet another. In 2007 just as the economy was picking up again, it was hit by a double disaster; first a flood which was followed by a cyclone which destroyed 17 health centres, 332 classrooms and 20 800 hectares of crop. It also affected safe water and sanitation facilities. This led to an outbreak in cholera and other water borne diseases. Making lots of people sick which also reduced production output. (Foley, 2007)
When there is a reduction in output, the economy suffers as this means there will be shortage in the economy, the supply for the goods and services will not be able to meet demand.
3.0 The policies aimed at reducing poverty
When Mozambique gained independence in 1975, the first thing it did was to come up with a new constitution that would be the guideline as to how the country would be governed. (Bauer & Taylor, 2011) To add to the constitution a number of policies were put into place to help the country out of the dire economic situation. The government came up with a 10 year Indicative Perspective Plan which was launched in December 1981. (Tarp, Jensen, Robinson, & Heltberg, 2002) This plan aimed at creating and developing a heavy industry, developing a state agricultural sector, cooperative transformation of the countryside and massive human resource development. These were ways to create employment opportunities, to reduce the number of those who are dependent on the government fro survival
3.1 Economic and Social Rehabilitation Program (ESRP)
In 1989 the Economic and Social Rehabilitation Program (ESRP) was formed its main aim was economic growth through a shift to a more market based economy. It responded to an economy that was failing to maintain monetary control and consuming beyond its means. (Tarp, Jensen, Robinson, & Heltberg, 2002) .The government sought help from the International Monetary Fund (IMF) and the Structural Adjustment Programmes were introduced in Mozambique. With advice from the IMF to introduce Fiscal Policy measures, the Mozambican government introduced Value Added Tax; it reduced import duties and reformed custom services. (Shikhani, 2012)
In 2001 the Mozambican government adopted what was known as An Action Plan for the Reduction of Absolute Poverty (PARPA). It was drawn with the assistance of the World Bank and other international donors. It has set a series of strategic goals including improving education, health and good governance and the development of infrastructure in rural and urban areas. If these worked well then they would have the potential to reduce poverty
3.2 Strategy for Development of small and medium sized Enterprises (SMEs)
The majority of the population have got small or medium size businesses which they run as a way to earn income. Through this strategy the government subsidies on production costs at times even charges little to no tax at all to help grow and sustain these businesses so that they can be able to compete with goods on international standards. (2011 Republic of Mozambique: Poverty Reduction Strategy Paper, 2011)
3.3 Master Plan: Director Plan For Prevention and Mitigation of Natural Disasters
The Mozambican government cannot influence climate change but it can have some of control on its effects. To address this it came up with a Master Plan: Director Plan For Prevention and Mitigation of Natural Disasters in October 2006. The aim of this Master Plan was to deal with Mozambique’s vulnerability to natural disasters. It also covered issues such as re-forestation and the development of a national irrigation system to the plantation of crops that can survive drought. (Foley, 2007)
3.4 Strategic Plan for Agricultural Development (PEDSA). The government also realised that the majority of its people were reliant on agricultural produce, so they came up with a scheme known as the Strategic Plan for Agricultural Development (PEDSA). Its objectives and aims were to grow the agricultural sector from a subsistence farming industry to a competitive one that would raise the incomes or rural people as well as contribute to food security. (Pauw, Thurlow, Uaiene, & Mazunda, 2012)
THE CHALLENGES FACED BY THE PROPOSED POLICIES
The government has come up with a great number of policies, but most of these policies are met by a number of challenges. To begin with the agricultural sector, the government has spent millions to grow the sector, but things; like having no access to factors of production especially with relation to women slows the growth of the sector. People produce tonnes of food but they do not have a market or proper storage and so losses are made. The problems of pest and animal disease also reduce the yields (2011 Republic of Mozambique: Poverty Reduction Strategy Paper, 2011)
The number one major problem that SMEs strategy faces is that most of the entrepreneurs have no formal education or a background on how to run a business. These businesses end up collapsing with in the first five years of its conception because there is no understanding of how the business works.
When it comes to economic rehabilitation the government is still failing to fully revive and stabilize the economic situation in Mozambique, because the proposed policies looked good on paper but their implementation does not yield good results e.g. the cutting down of import rates and quotas. This now turned Mozambique into a dumping site as the quality of goods that were imported there were of very low standard. (Dava, Chigora, Chibanda, & Sillah, 2013)
Looking at the master plan which has been put forth to as a guide in cases of natural disasters, when looking at how they handled the 2007 crisis one would applaud them for the efficiency in evacuating people and setting up temporary shelters. On the other hand their information management systems and meteorological networking systems still need improving for smooth running of operations.
Conclusion
Looking at the history of Mozambique, it is understandable why it is among the poorest countries in world. The wars, floods, severe droughts have left the country and its people in the poorest of situation. With good expansionary monetary and fiscal policies, this country has the potential to rise from its situation to become of the richest. It has fertile lands and attractive tourist places which are yet to be used to their full potential, but we have found that the policies only look good on paper. This means that the country needs to be more strategic when coming up with policies.
BIBLIOGRAPHY
(n.d.). Retrieved march 11, 2015, from UNICIEF: www.unicief.org/mozambique/overview
(2011). 2011 Republic of Mozambique: Poverty Reduction Strategy Paper. Washington D.C: International Monetary Fund.
Bauer, G., & Taylor, S. D. (2011). Politics in Southern Africa 2nd edition. Colarado: Lynne Rienner Publishers, INC.
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