The Mozambican government intends to broaden access to finance for producers, entrepreneurs and businesses operating in rural areas through the Rural Enterprise Finance Line (LFER), as part of its broader strategy for the structural transformation of the national economy.
The position was set out by Minister of Planning and Development Salim Valá on Thursday, 3 July, during the LFER Dissemination Seminar held in Nampula, in the north of the country. On the occasion, the minister stressed the need to bring financial services closer to economic actors operating in rural areas.
'We are faced with an instrument that has the potential to bring financing within reach of the producers, entrepreneurs and businesses that sustain economic activity in rural areas,' Valá said, arguing that the facility should help transform the economic potential of rural zones into production, employment and income.
According to the minister, cited in a statement from his ministry, the LFER is an initiative structured by the government in partnership with the International Fund for Agricultural Development (IFAD), designed to address one of the main constraints to rural development. Ensuring that financing reaches economic actors 'in an adequate, sustainable, responsible and affordable manner' is, according to Valá, one of the initiative's primary objectives.
The LFER builds on the Rural Enterprise Financing Project (REFP), which concluded in September 2025. During its implementation, approximately 726 million meticais — equivalent to around US$11.4 million — were channelled through Moza Banco to nine participating financial institutions.
According to the minister, funds recovered through repayments should neither sit idle nor disappear with the closure of the project. 'Every metical deployed must produce an impact in the present and, through its recovery, create capacity to finance other entrepreneurs in the future,' he stated.
The new line will be structured around three pillars: bank credit, investment mobilisation, and technical assistance and business capacity-building. For Valá, this combination is necessary because 'credit alone does not always resolve the constraints faced by rural entrepreneurs'.
'Financing must find well-structured projects, competent management, adequate assistance, appropriate technology and effective market linkages,' he added, advocating an approach that goes beyond the mere provision of credit.
The minister also presented results from the Local Economic Development Fund (FDEL), which in 2025 received 356,663 applications, of which 18,721 were approved. To date, 18,562 projects have been financed, with youth participation standing at 65.97% and women's participation at 42.46%.
Projects financed through the FDEL have created 43,044 jobs and benefited 112,405 citizens. For 2026, the government has allocated 1.5 billion meticais to the initiative.
Nampula accounts for 16.1% of national demand. The province recorded 57,436 project submissions, representing 16.1% of national demand, with estimated financing needs of 8.67 billion meticais. A total of 3,869 projects were approved and financed, generating 12,195 permanent and seasonal jobs.
Valá also announced that the government is preparing to launch the Fund for Women's Economic Empowerment (PROMULHER), expected later this year, dedicated exclusively to supporting small businesses run by women in both rural and urban areas.
For the minister, the LFER 'should not be understood merely as another credit line' but as 'a comprehensive platform for financial inclusion, economic empowerment of entrepreneurs, investment mobilisation and the revitalisation of rural value chains'.
The minister called on financial institutions to develop products tailored to the economic reality of districts, where approximately 66% of the Mozambican population lives. 'Rigorous risk analysis must be accompanied by a search for solutions that reduce barriers and allow viable projects to access financing,' he said.
In assessing the LFER, the minister argued that the volume of funds disbursed should not be the sole indicator of success. 'It will have to consider the quality of investments, the recovery rate, jobs created, the participation of women and youth, the number of producers integrated and the productive linkages generated,' he stressed.
The minister concluded by arguing that rural financing must be viewed as a tool for economic and social transformation. 'Financing the rural economy is not merely supporting an economic activity. It is expanding opportunities, strengthening communities and building a more solid foundation for Mozambique's economic independence.'
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/2026/09/03/economia/salim-vala-defende-maior-acesso-ao-financiamento-para-dinamizar-economia-rural/
