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The merger of three of the five leading (and biggest) law firms, H Gamito Couto Gonçalves Pereira Castelo Branco e Associados, MGA Advogados and Furtado Bihka Loforte Popat & Associados (FBLP), into CGA (Couto Graça and Associates) in 2011 is a reflection of the increasing deal flow in the market and demand for capacity from clients.The appetite for investment into Mozambique in recent years has grown considerably....

The merger of three of the five leading (and biggest) law firms, H Gamito Couto Gonçalves Pereira Castelo Branco e Associados, MGA Advogados and Furtado Bihka Loforte Popat & Associados (FBLP), into CGA (Couto Graça and Associates) in 2011 is a reflection of the increasing deal flow in the market and demand for capacity from clients.

The appetite for investment into Mozambique in recent years has grown considerably. "There is still a lot of room for development in Mozambique, Angola used to be the focus of all investments and now Mozambique is attracting people, for example Samsung and Hewett Packard are establishing headquarters here and we are getting weekly requests for establishing companies," says a partner.

Possibly the single biggest driver for the country has been the coal mining operations in the north of country, led by investment from Brazilian company Vale, along with the raft of infrastructure and development projects which is accompanying it, among them the construction of a port, of roads and bridges and of the Nacala Railway. The work has also seen an influx of mining service companies.

"There are a number of infrastructure projects and oil & gas is one of the interesting areas now with Vale doing the big mining operations and a US company looking for liquefied natural gas," says a commentator.

Another lawyer adds that "Mozambique itself is quite different to Angola, for instance, it is a combination of being the darling of the international cooperation community and having increased economic activity; we see quite a few new projects with international cooperation such as the electrification of the country." Compared to neighbours the country is certainly "more friendly" and a "more secure place to do business" say clients, "they have lots of bilateral investment treaties, trying to be the good guy and ensuring investments are protected".

New legislation was implemented in April 2011 (though still untested) to introduce new exchange control regulations ostensibly to simplify foreign exchange transactions and to encourage investors to convert assets into Meticals and strengthen the domestic currency. The government was also working on a new mining law and looking at specialist legislation for mega-projects.