Despite modest trade volumes between Mozambique and Russia, Russian business executives are identifying opportunities in agriculture, logistics and industrialisation. Their preferred model centres on local production, yet challenges related to logistics, payment mechanisms and the broader business environment continue to constrain new investment.
Relations between Mozambique and Russia have evolved from predominantly political cooperation towards a partnership increasingly focused on trade, investment and business collaboration. Despite that mutual interest, bilateral trade volumes remain low and well below the potential identified by both governments.
Data from UN Comtrade and the International Trade Centre (ITC Trade Map) show that in 2024, Mozambique imported goods worth US$164.6 million from Russia, primarily cereals and fertilisers, while exports to the Russian market stood at just US$268,700 — a bilateral trade relationship that remains heavily imbalanced and with significant room for growth.
For Russian business executives, Mozambique stands out not only for its agricultural and mining potential but also for its strategic geographic position, which they argue could transform the country into a logistics platform for access to Southern African and Indian Ocean markets. This view was put forward by Anton Slinchenko, a representative of Business Russia — a pan-Russian public organisation representing the interests of private companies and local industrial leaders — during a meeting with African journalists in Moscow.
Understanding Africa is the first challenge.
Getting to know Africa better is the first challenge
For Slinchenko, the primary obstacle facing Russian companies is not a lack of interest in the continent but rather insufficient knowledge of the specific characteristics of each African market.
He argues that one of the most common mistakes is treating Africa as a single market. “When we talk about Africa, we understand that each country has its own policies, its own business environment and its own opportunities,” he said.
For that reason, the organisation prioritises a bilateral approach, establishing contacts directly with embassies and national business organisations.
Slinchenko explained that diplomatic missions serve as the main entry point for Russian entrepreneurs interested in investing in Africa, facilitating institutional contacts, clarifying questions around legislation and connecting companies with their respective governments.
In parallel, the organisation seeks to conclude memoranda of understanding with chambers of commerce, business confederations and other local economic entities, promoting business-to-business meetings, trade missions, seminars and permanent platforms for information exchange.
Finding local partners becomes a priority.
Once a market is understood, the next step is identifying credible partners.
Local partners become a priority
For Slinchenko, this is currently the second most common request received from Russian companies. “The second request from Russian business is to find a reliable partner in a specific country,” he said.
That search has led Business Russia to develop a cooperation network with African business organisations responsible for identifying local companies capable of developing joint projects.
The organisation has also created a network of so-called “Business Ambassadors” — Russian entrepreneurs who reside permanently in African countries and act as intermediaries between Russian investors and local firms.
The objective is to reduce risk, accelerate commercial contacts and facilitate the transfer of Russian technologies to different African economies.
Mozambique draws interest in agriculture and logistics.
Among African markets, Mozambique is regarded as one of the more promising destinations by Russian business executives.
Mozambique draws interest in agriculture and logistics
According to Slinchenko, institutional cooperation began to take shape in 2019 with the signing of a memorandum of understanding between Business Russia and the Confederation of Economic Associations of Mozambique (CTA).
Since then, several sectors have been assessed, but agriculture continues to attract the greatest attention. “The main format of cooperation is the localisation of production in Mozambique. Russian companies involved in fertiliser production and the agricultural sector identify strong potential in Mozambique, both in terms of existing demand and the country’s natural conditions,” he explained.
Beyond agriculture, there is also growing interest in the export of machinery, industrial equipment and the development of logistics solutions.
In Slinchenko’s view, Mozambique’s geographic position represents an important competitive advantage for future trade links between Russia and the Indian Ocean. “Mozambique is one of the countries most interested in organising logistics corridors from the Indian Ocean to Russia,” he said.
Localising production could generate greater added value.
Localising production can create greater added value
Rather than simply exporting equipment or raw materials, Russian business executives argue that the next phase of economic cooperation with Mozambique should involve establishing production units in the country. The strategy would reduce logistics costs, bring production closer to consumer markets and contribute to the industrialisation of the Mozambican economy.
According to Slinchenko, this is precisely one of the topics under discussion between Business Russia and the CTA, with a focus on agriculture, fertilisers and industrial equipment. “The main format of cooperation is the localisation of production in Mozambique,” he emphasised.
“The main format of cooperation is the localisation of production in Mozambique. Russian companies involved in fertiliser production and the agricultural sector identify strong potential in Mozambique, both in terms of existing demand and the country’s natural conditions,” Slinchenko said.
The proposal also aligns with priorities set by the Mozambican government, which is seeking to increase the local processing of raw materials, reduce import dependence and develop industrial value chains. Although no large-scale Russian projects have yet been established in the country, the interest expressed by Russian companies could open space for future partnerships in sectors considered strategic.
Slinchenko added that beyond agriculture, opportunities exist in the production of agricultural machinery, industrial equipment and other technologies that could be manufactured or assembled locally through partnerships with Mozambican companies.
Logistics and payments remain among the biggest obstacles.
Logistics and payments remain among the biggest obstacles
Despite the opportunities identified, the realisation of new investments continues to be constrained by operational difficulties.
From Business Russia’s perspective, logistics represents one of the main obstacles to trade between Africa and Russia. Currently, trade flows are imbalanced: Russia exports significantly more to Africa than it imports, keeping transport costs high and reducing the competitiveness of commercial operations.
“We have far more exports to Africa than imports. We need to make this trade more balanced,” Slinchenko said, adding that international payment mechanisms present a further challenge. Sanctions imposed on the Russian financial system have complicated international banking operations and forced companies to seek alternative solutions.
According to Slinchenko, the absence of Russian banks with a direct presence in many African countries, including Mozambique, continues to impede commercial transactions. “We need to establish direct payment channels,” he said.
In practice, these factors increase the cost of commercial operations and slow the pace at which deals between companies in the two countries can be concluded.
Institutional trust weighs on investor decisions
Institutional confidence weighs on investor decisions.
Beyond logistical issues, Russian business executives identify another determining factor: the predictability of the business environment.
During his remarks, Slinchenko said investors look for clear rules, institutional stability and mechanisms that guarantee legal security for investment projects.
He explained that foreign companies value transparent processes, strong institutions and public bodies capable of ensuring that agreements are honoured regardless of political changes.
While he directed no specific criticism at Mozambique, he noted that many investors carefully examine the functioning of institutions before committing to long-term investments.
This reality underscores the importance of reforms the Mozambican government has been implementing to improve the business environment, streamline administrative procedures and attract private investment.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=539495
