USAID supports the Government of Mozambique with streamlining construction permitting process
Mozambique has historically struggled with the process of issuing construction permits. The slow issuing process was identified by the private sector as a major obstacle impeding businesses. However, things are starting to change for the better. The latest World Bank Doing Business 2014 report shows a substantial improvement in the country’s construction permit indicator, jumping 46 places to 77th from 123rd in the most recent rankings. The country overall improved in rank by 7 places, from 146th last year to 139th this year, out of the 189 economies in the overall Doing Business country ranking. The World Bank Doing Business report is comprised of 11 indicators that measure a country’s business regulations, property rights, tax burdens, access to credit, and the cost of exporting and importing.
The USAID Support Program for Economic and Enterprise Development played an important role in this recent success. The program began working with the municipality of Maputo in October 2011 to simplify the process of obtaining construction permits.
The program provided extensive technical assistance to map out the improved processes. This was followed by in-kind grant support comprised of technology equipment to the Department of Urbanization and Construction and two consultants to design a working business process management system and a database that supports a file tracking system. A statistics consultant was also hired to analyze the amount of time required to get a license before and after the technology was introduced.
According to the latest Doing Business estimates, these efforts contributed to a savings of approximately 247 days in the process for obtaining a license, resulting in substantial savings to the private sector, increased investment, and employment. The program estimates indicate that the private sector saved approximately $3.7 million and created nearly 2,600 jobs over the course of the year as more licenses were processed, allowing construction projects to start sooner.
“This effort shows that a dynamic, committed partner can make real change happen over a short period of time, even in a difficult environment,” said Brigit Helms, the Program’s Chief of Party. The World Bank’s recognition of Mozambique offers further encouragement to continue work with the municipality on monitoring the implementation of other recommended reforms.