Monday, March 28, 2011

IFAD Lends US$21.1 million to Mozambique

A US$21.1 million loan from the International Fund for Agricultural Development (IFAD) to the Republic of Mozambique will enhance artisanal fisheries and increase the incomes of poor rural households in fishing communities, the United Nations rural poverty agency has announced.

The loan agreement for the Artisanal Fisheries Promotion Project was signed today in Rome by Carla Elisa Mucavi, Ambassador and Permanent Representative of the Republic of Mozambique to IFAD, and Kanayo F. Nwanze, President of IFAD. The loan will be extended to the country on highly concessional terms. Inshore waters in many coastal areas of Mozambique are becoming heavily overfished due to widespread use of fishing techniques such as beach seines, large weighted nets that can catch an entire school of fish. Catch sizes are falling, and return per unit of effort is starting to decline. However, many open sea areas along the coastline remain underexploited. The Artisanal Fisheries Promotion Project will encourage artisanal fishers to diversify their operations into offshore waters.

The project, which is co-financed by the Government of Mozambique and the beneficiaries, will both raise the incomes of poor fishing households and provide incentives to reduce fishing in inshore waters. It will also bring a sustainable increase in returns from fish sales for artisanal fishers and small market operators. Technical advances in catching, processing and marketing fresh fish will bring innovation and scaling-up throughout the whole fishing process – from boats and propulsion systems to fishing gear and post-catch processing, and particularly in the use of ice. The project also addresses access to financial services. A risk mitigation fund will be promoted to encourage private financial institutions to invest in the artisanal fisheries sector. In addition, community-based savings and credit groups will be more professionally structured and linked with the formal financial sector, increasing fishers’ access to credit.

The project will directly benefit over 40,000 vulnerable rural households for whom fishing and fish products are the principal source of livelihood and often the only source of cash income. Another 40,000 households will receive indirect benefits. The project will build on and scale up some of the successful activities previously implemented by the Mozambique Ministry of Fisheries with the support of IFAD under two projects – the Nampula Artisanal Fisheries Project and the Sofala bank Artisanal Fisheries Projects, a partnership since 1993. With this new project IFAD’s investment in the country’s artisanal fishery sector comes to US$45 million. IFAD’s total investment in Mozambique now totals US$196.2million, with 11 projects benefiting nearly 2.2 million households.

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