How Mozambique can benefit more from its massive gas discovery


In 2010 Mozambique discovered the second largest gas find in the world since Qatar but the Southern African country still needs to benefit from the valuable resource, explains Jon Foster Pedley, Dean and Director of Henley Business School.

“Often when African countries make huge discoveries in resources, the people on the ground are the last to benefit from such finds; Pedley reckons the business sector has to take more initiative in giving back to the country’s skills development.

The country needs to invest more into sophisticated business skills, manufacturing, banking and services industries  for example so that it can compete in the world, like Dubai did, Pedley states and that has resulted in the country falling short of the maximum benefits  of which this natural gas could award them.


“They [Mozambique] are compressing it into liquid natural gas but most of that production has been sold off to Japan,” says Pedley.

“What we have to do is work out how we can beneficiate and make use of this natural gas,” he adds

Pedley explains that the gas find is so vast that it could sustain South Africa for centuries without any power cuts.

“It’s huge, I don’t think people really understand quite how big it is, you have got enough gas there to fuel South African energy, for example, for 150 to 200 years on its own.”

Pedley says the country should find a way to benefit from the gas by either ploughing it back into the economy or by using it to diversify the economy and build skills.

“I’d love to see that money being used to assiduously train up a generation so that Mozambique is proud and stands up on its own.”

Pedley challenges Mozambique to stepping up its game and wanting to get the skills to avoid the common occurrence of African countries not reaping the full benefits of its resources.

“What you’ve got are many African countries, with either money coming through commodities or oil and then people not being educated,” said Pedley.

Pedley reckons Africa has the capabilities to make the most of its resources but instead of fully investing in their success, he sees the potential not being honed in on and developed, for example in the many street vendors who show keen business savviness.

“You’re seeing oranges and coconuts and other hugely active entrepreneurial substructs but what you’re not seeing is the education, the support, the institutions and everything else to help people make money out of that in the countryside,” said Pedley.

“We have all the intelligence and ability we want in Africa and people don’t realise that.”

Eighty per cent of the labour sector in Mozambique is in agriculture while in Africa, according to Pedley, the most growth is seen in urban areas. He thinks we need to develop skills in all sectors in order to be equipped enough to make sure the wealth stays in Africa.

“All we have to do is start developing, build better communications, some basic training, develop entrepreneurship and you’ll see more of that money being used by the people on the ground rather than slipping offshore,” said Pedley.

He thinks this is a model that most developing economies on the continent should use considering the vast rate Mozambique is growing.

“You’re looking at an economy that is growing at 7-1/2 per cent – that’s faster than China was last year,” Pedley believes that we need to be “afro-positive” and “afro-optimistic” about the development of Mozambique.

Not to say we should be naïve in our optimism but that he believes these trends are going to continue and “we have to be very smart to make use of them”.