How can Mozambique improve cashew processing profitability and sustainability ?

National Economic Priority: Transforming the Cashew Value Chain

The cashew sector represents a critical opportunity for Mozambique to drive economic diversification, create rural employment, and generate sustainable export revenue. Our national strategy must holistically address the challenges and opportunities within this strategic agricultural value chain.

Comprehensive National Policy Objectives

1. Regulatory and Policy Framework

Strategic Policy Interventions:

Maintain and strategically leverage the Raw Cashew Nut (RCN) export tax
Preserve the preferred procurement window to prioritize local processing
Develop targeted market access strategies, particularly within the Southern African Development Community (SADC)

Rationale: These policies create a protective ecosystem for local processors, ensuring that Mozambican value-added processing remains competitive against international low-cost producers.

2. Institutional Strengthening: AICAJU Development

Government Role:

Provide increased operational grants to AICAJU
Mandate clear, measurable performance roadmaps
Support comprehensive industry coordination mechanisms

Key Focus Areas for AICAJU:

Trade promotion
Economic intelligence gathering
Technological surveillance
Commercial regulation
Technician training
Strategic partnerships

3. Strategic Revenue Allocation

Innovative Use of RCN Export Tax Revenue:

Diversify support beyond traditional production assistance
Focus on:
Producer organization development
Quality improvement initiatives
Certification support
Waste valorization programs
Worker condition enhancements
Agricultural diversification strategies

4. By-Product and Circular Economy Development

National By-Product Valorization Strategy:

Integrate Cashew Nut Shell Liquid (CNSL) into national energy mix
Develop a centralized by-product management platform
Support technological innovations like pyrolysis furnaces
Create markets for secondary products (animal feed, charcoal)

5. Financial and Operational Ecosystem Support

Government Intervention Mechanisms:

Establish a guarantee fund for cashew sector projects
Implement VAT exemptions for processing inputs
Develop worker training and formalization programs
Promote renewable energy integration in processing

6. Business Environment Enhancement

Structural Improvements:

Simplify administrative procedures
Invest in critical infrastructure (e.g., Nacala port)
Support formation of industrial clusters
Develop price volatility mitigation strategies
Harmonize regional regulatory frameworks

7. Long-Term Strategic Vision

Transformative National Objectives:

Integrate cashew value chain into national economic diversification strategy
Invest in green infrastructure and climate resilience
Develop research and development partnerships
Create a pathway for economic transformation through agricultural value addition

Financing and Investment Strategy

Key Investment Priorities

Technology transfer and innovation
Infrastructure development
Human capital development
Market access expansion
Sustainable processing technologies

Potential Funding Mechanisms

National budget allocations
International development partnerships
Sovereign wealth fund investments
Public-private partnership models

Monitoring and Evaluation Framework

Performance Indicators:

Processing capacity expansion
Export value growth
Rural employment generation
Technology adoption rates
Sustainability metrics
Worker skill development

Implementation Roadmap

Short-Term (1-2 Years)

Strengthen AICAJU
Implement tax and regulatory optimizations
Launch worker training programs

Medium-Term (3-5 Years)

Develop by-product valorization infrastructure
Expand industrial clusters
Enhance market access strategies

Long-Term (5-10 Years)

Achieve comprehensive value chain integration
Establish Mozambique as a premium cashew processing hub
Create a sustainable, globally competitive cashew ecosystem

Conclusion: A Holistic Approach to Economic Transformation

The cashew sector is more than an agricultural industry—it’s a strategic pathway to economic diversification, rural development, and national prosperity. By implementing a comprehensive, integrated approach, Mozambique can transform its cashew sector into a dynamic, sustainable economic engine.

Our strategy transcends traditional agricultural development, positioning cashew processing as a key driver of innovation, employment, and economic resilience.