As Mozambique’s infrastructure and housing sectors continue to expand, steel component manufacturer Intermetal has recorded impressive levels of growth that look set to continue. Manager Eduardo Duarte describes the potential for partners to join the company on its path and the competitive advantages the country has over other African nations.
In recent years Mozambique has grown at the average rate of 7.5% yearly. As an entrepreneur, a businessman and as a local, which would you say are the characteristics that distinguish Mozambique from the rest of Africa?
Mozambique is in many ways different from many African countries. First, not only because of stability but also for its proximity with South Africa (both share the same borders), which facilitates when it comes to us having access to technologies many countries in Africa don’t have. For example, from Maputo people can fly to Johannesburg and from there travel to the world, while other countries, (mostly those of the interior) don’t have that advantage.
The third advantage is that Mozambique is always improving its “Doing Business” ranking, there are always new things to offer to investors and the country is always innovating and streamlining steps to setting companies. The other feature that also makes things easier for investors is that – unlike South Africa and Zimbabwe that have the so-called “Black Power Empowerment” which consists of obliging companies to give a contribution for the improvement of the native population – in Mozambique investors don’t have that obligation.
I’ve seen investors saying that they have been to South Africa and still prefer to invest in Mozambique because here they don’t have that kind of problem; there are several factors that make it easier for investors to choose Mozambique as investment destination.
With regards to “Doing Business”, according to the World Bank, Mozambique has improved a lot. How would you describe the metal industry in this country? Can one tell it’s a developed industry?
If truth be told, we are talking about a sector that barely exists. Industries like this start with a complete mining sector; we have iron and other ores, especially in Nampula. From ores come the steel making – that purifies the steel. After that come the companies that fabricate the profiles, the angles, the bars, the plates etc. What Mozambique has in operation is only the last stage, that is, the transformation of the cold steel. At the initiation stage, we have the industries that fabricate zinc plates, steel bars, tubes, etc. At the moment, a complete mining and processing industry doesn’t exist in spite of the existence of ore.
What products are you offering right now?
Intermetal fabricates zinc plates, bars, lip channels and much more for the construction of warehouses.
Up to now it has been our company that has supplied the material used for the construction of several warehouses located in the industrial zone of Matola.
What can you tell us of the company’s evolution and how do you see the business environment as well as the world’s interest in Mozambique? Do you see its perspectives of growth?
This company was established in 1977 and used to be state owned. But with the change to a market economy it got partially privatized, but always kept its objective. At the time it was privatized it had employees that knew the business very well, who we thought better to keep with us. Some still continue with us, while others are retired.
In the first years, similar to many companies, we went through difficult times. But since the fourth year this company started to experience positive growth. Intermetal is now growing at 27.5% average annually.
Do you believe that growth is going to increase?
Actually we have two things to consider: in Mozambique, it is common to see the self-build sector, in which people buy construction materials and build their own houses. The other thing is the segment in which we supply our products to industries. As the country grows, the construction of infrastructure and of houses is also growing, so we can say that the two mentioned aspects have their influence on our growth.
What can you say about the quality of your products and what are you doing to support, develop and add value to what you manufacture?
Our production is sold with certified quality, meaning that upon request we provide customers with a certificate of quality. The other thing is that we don’t buy any material without the manufacturer’s warranty, which we hold responsible if quality issues arise. We buy most of our material from ArcelorMittal in South Africa, from whom we also require a quality certificate.
What services does Intermetal offer?
Basically, we offer raw materials but we count on the assistance of partners for specific tasks. For instance if someone contacts us saying that they want to build a warehouse, we work in association with our partner who sends us the budget and we fabricate the material.
We also contribute to the education sector manufacturing school desks, and likewise, we provide the material and our partner fabricates.
Is the company open to new partners?
Absolutely. We are on a project to do a bigger cold processing factory. Like I said, the last phase of the steel is the cold processing, and plates are made in bobbins and then enter the last phase of cutting. New partners are welcome.
Our objective is growth; it is to create jobs, to increase revenues as well as our contribution in terms of taxes.
What benefits can Mozambique expect by participating in The Global African Investment Summit 2015 in London?
I remember that 10 or 15 years ago migration agents would (even with our passport in hands) ask us where Mozambique was. Things are different now; it is good to see that the information on our country is now delivered correctly to the world. That helps when it comes to attracting foreign investments.
Industries like, oil, gas, coal, and all types of processing industries will need our steel. Steel may even be the major component in these equipments. In the other hand there is also the housing for those working in the projects. The results of the Summit will be of great benefit for the steel industry.