Good afternoon. President Daniel Chapo is moving ahead with the promise he made during his election campaign to reintroduce a loan scheme for business ventures. This initiative, to be called the Local Economic Development Fund (FDEL), looks like a revival of the “Seven Million” venture that ran under former president Armando Guebuza. Like Seven Million, it is intended to provide loans at district level for business ventures, in an effort to stimulate economic development in rural and suburban districts that have been left behind. The government also aims to use it to tackle youth unemployment, a major source of resentment against Frelimo.
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The initiative has some potential, although its aim to create more gainful self-employment also reflects the fact that there are not many employed positions to apply for. It could be of use to young people who have acquired a professional qualification (the labour ministry provides training courses) and need start-up capital to launch their businesses.
