Supporting the Policy Environment for Economic Development

Extralegal barriers to the employment of foreigners in Mozambique

Economic growth in Mozambique makes the country more attractive for foreign investment, which is necessary for the development of the national economy. The employment of foreigners in Mozambique, as well as the applicable procedures for doing so, are duly regulated by various national legal instruments.

Although the business environment has improved in recent years companies, be they small, medium-sized or large, have suffered from demands on the part of the authorities, for compliance with formalities not established in the Legal Framework (extralegal barriers) for processing applications for authorizations, permissions and other decisions concerning the legalization of foreign labor in Mozambique. To a large extent this has imposed difficulties on operations and considerable costs for the companies.

These formalities, since they are not established by law, are conducive to a lack of legal certainty and contribute negatively to the business environment of the country. Thus, there is no point in simplifying the procedures for the establishment of companies when, after their establishment, investors are faced with extralegal barriers related to their own employment and the legalization of their stay in Mozambique and also that of the staff they require to go ahead with their business.

For the purpose of this research, “extralegal barriers” are held to be all requirements and any kind of procedures, not laid down in the Legal Framework, but imposed by Government officials on employers regarding the contracting of foreign employees. The expression “extralegal barriers” can also apply to the non-application of legal provisions in force for promoting the business environment or even to the erroneous application of a legal provision resulting from an interpretation that is not in line with the spirit of the law.

In some cases the extralegal barriers result from ignorance of the law and the absence of qualified staff in Public Administration and in others, the more serious cases, from abuse of power and the authorities’ disorderly exercise of their discretionary power, which goes against the principle of legality which is expected to guide the performance of public administration.

It should be noted that these extralegal barriers are totally opposed to the objectives of the Government’s Five-Year Program for 2015-2019, as regards the simplification of procedures and the improvement of competitiveness, with a view to making the business environment more attractive for investment and allowing Mozambique to take up a reference position in the regional and global ranking.

The achievement of the Government’s objectives, depends on the interaction between the various branches of Government for the promotion of foreign investment. The realization of these objectives is also closely linked to the facilitation of the entry and stay of key persons, essential for investment, and the improvement of the business environment so as to attract more investment, and the creation of more jobs as well as the increase of business opportunities for the local business community. The reports below do not however request the liberalization of the entry of foreign citizens, but instead appeal for the application of the Legal Framework as it is established, which already provides for the conditions that should be observed for the employment of foreigners in the country.

The reports below aim to identify the extralegal barriers to the employment of foreigners, in which extralegal barriers are understood to include all aspects, procedures or requirements not established by law and which are being applied and are creating obstacles to the private sector, as well as all aspects, procedures or requirements that should be applied because they are established by law and are not applied, to the detriment of the private sector. The reports also aim to provide recommendations for the elimination of these barriers, thus creating a more business-friendly environment in Mozambique, in order to ensure strong and sustainable economic growth.

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