5.3.2010

Portucel, Mota to Invest $2.4 Billion in Mozambique

March 5 | Bloomberg 
By Fred Katerere 

Portucel-Empresa Produtora de Pasta e Papel SA, Portugal’s biggest paper maker, and Mota-Engil SGPS SA, its biggest construction company, will invest a combined $2.4 billion in Mozambique, the companies said.

Portucel will invest $2.3 billion in a paper manufacturing plant in the south-east African nation, senior executive Pedro Moura told reporters in the capital, Maputo today. “The initiative will create 7,500 direct and indirect jobs and this could triple after operations begin,” he said.

Mota will build a bridge over the Zambezi River linking the country’s port city of Beira to landlocked nations like Democratic Republic of Congo, Malawi, Tanzania and Zambia. The bridge, which will be an alternative to the existing structure that can’t support current cargo, is valued at 100 million euros ($135,87 million), Mota Chairman Antonio Manuel da Mota said.

The companies formed part of a 55-member delegation that joined Portuguese Prime Minister Jose Socrates on a visit to the European country’s former colony of 22 million people.

The two countries will set up a bank, to be known as the Luso-Mocambicano Banco de Investimentos, and will have $500 million of start-up capital, STV reported. The nations will each own half of the lender, according to the Maputo-based independent broadcaster.

The bank wil finance the construction of the more than 2,000 kilometers (1,243 miles) of rail links between Maputo and Tete province, where the country’s largest approved coal deposits lie. Riversdale Mining Ltd., an Australian company, and Vale SA, the world’s biggest iron-ore miner, have acquired mining concessions and are expected to start production by 2011.

The investment bank is also expected to finance a $700 million expansion project on the Cahora Bassa hydropower plant on the Zambezi River and the construction of a $100 million bridge project linking Maputo city with the satellite town of Catembe over the Indian Ocean.

To contact the reporter on this story: Fred Katerere in Maputo via Johannesburg on pmrichardson@bloomberg.net.

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