Turkey Plans to Invest $1 Billion in Mozambique Over 20 Years

MAPUTO (Capital Markets in Africa) – Turkey will invest $1 billion in Mozambique over the next two decades, President Recep Tayyip Erdogan said during a two-day visit to the southern African country struggling to attract foreign investment.

Mozambique’s finances have been in trouble since early 2016 when it emerged the government withheld information about the magnitude of its indebtedness while arranging new credit. The nation has since said missed interest payments for external commercial loans, including a $60 million coupon on January 18.

Mozambique’s economy, heavily dependent on commodity shipments and donor aid for revenue, has contracted for two straight years to $12 billion at the end of 2016, according to International Monetary Fund estimates. The lender withdrew its monetary support for the coal-producing nation in April.

Erdogan said trade between the two countries amounted to $150 million in 2016 and could grow in the next five years to $500 million. Turkey also intends to build 16,000 homes and “help in the urbanization of the capital city,” he said.

Erdogan called for support fighting “terrorist cells” in Mozambique and said a company in the country belongs to groups that finance what he called terrorism and attempts to overthrow his government.

Mozambique President Filipe Nyusi said “cooperation with Turkey can be a gateway to the Middle East.