The Member of the Executive Committee (MCE) of Moza Banco, Jaime Joaquim, recently argued in Maputo, during the 1st edition of Expo India - Mozambique 2023, that the challenges related to financing agriculture in the country could be solved if the risk associated with the activity was shared.

Jaime Joaquim explains that given the scarcity of insurers interested in covering the agricultural sector, largely due to the possible occurrence of natural disasters and calamities, banks often find it difficult to take on the risk of financing agriculture on their own, which greatly limits the sector's development.

In the meantime, the source draws attention to the replication of some practicable financing models, especially the one promoted by USAID (United States Agency for International Development), in which the entity proposes to cover at least 50 % of the financing in guarantees, with the Bank assuming the rest.

"With the financing model leveraged by USAID, in cases where the Bank provides financing to a certain player in the agricultural sector and, due to some natural disaster, that player loses the ability to repay the money to the Bank, we can be reassured to know that we have the possibility of recovering at least 50 % of the total amount financed. This risk sharing allows Moza to continue to be a bank that bets on agriculture and agribusiness in Mozambique, strengthening its commitment to these fundamental sectors," said Jaime Joaquim.

According to him, this makes Moza a "Bank of Agriculture" in the country, directly promoting various crops for domestic consumption and export, especially banana and mango production. And to cover even more of the agricultural sector, Moza extends its coverage to livestock, financing the production and breeding of cattle and sheep and investing in poultry.

Jaime Joaquim also pointed out that Moza also boosts the agribusiness value chain, emphasizing the financing provided indirectly to the production of crops such as sesame, cashew nuts, soya and so on. "We finance companies that boost these crops. I'm talking specifically about entities that produce and distribute inputs, ensuring that farmers have the raw materials they need to carry out their activities," he added.

In conclusion, the source called for joint reflection on the need to create a state fund that can help the different players in the agricultural financing chain, minimizing risks and significantly strengthening the banking sector's interest in agriculture and agribusiness.

Moza reaffirms its strategic interest in investing in agriculture as one of the key sectors for development. As a reliable partner, Moza Banco is constantly seeking to contribute to a promising future, where agriculture flourishes as a solid foundation for the progress and well-being of Mozambique and Mozambicans.

Under the slogan Uniting Cultures Through Trade, the 1st edition of Expo India - Mozambique 2023 took place on July 25 and 26, with the participation of hundreds of individuals who, over the two days, fostered good business relations that will surely be reflected in the growth of the national economy.