Informal trade in Mozambique and its neighbours goes largely undocumented and unreported.Agricultural commodities include sugar, maize, prawns and fish, meat, peanuts, Irish potatoes, beans and vegetables.Non-agricultural goods include beer, shoes, wood products, building materials, bicycles, bicycle and car parts, and electrical goods.A United Nations Conference on Trade and Development (Unctad) study found that traders use informal routes to avoid taxes, levies and other red tape.“Anecdotal evidence shows that the informal trade routes expose these traders to fines, corruption, theft and confiscation of their merchandise, which indicates an overall increase in costs and risks as compared to formal trade routes,” the report notes.Jose Luis Macamo of World Vision International – Mozambique, had researchers monitor 10 border crossings for a year.They found that “head/hand loads, handcarts and bicycle transportation were extensively used as means of crossing the border, with a view to avoiding tariff costs.“There was widespread use of small agents and transporters familiar with border areas and who specialised in methods of evading the customs system.”At the time of the 1996 study, Swaziland (now Eswatini) was Mozambique's biggest informal trading partner.Eswatini exported agricultural products estimated at $32.2 million to Mozambique against imports valued at more than $18m.Mozambique’s major informal agricultural imports from Eswatini were sugar ($16.4m), meat ($6.8m), peanuts ($2.4m) and maize f lour ($1 .4 m).It was estimated that around 90% of the total value of trade between Mozambique and Eswatini was unrecorded.Mozambican agricultural exports to Swaziland were limited to prawns ($15.3m) and wood products ($11.3m).Among the major non-agricultural goods imported from Swaziland were shoes ($6m), building materials ($2.6m), kitchenware ($4.2m), edible oils and margarine ($1.2m) and beer ($2 . 8m).South Africa was the second-biggest informal trading partner, with South Africa exporting goods worth around $19m and importing around a million dollars worth of goods.Attempts by governments to formalise the trade can have a direct impact on local micro-economies.The Unctad study found that “through their bidirectional supply of agricultural and food products, cross-border traders significantly contribute to reducing the food deficit where local production, food aid and formal markets prove insufficient to meet demand”
Hidden economy of small-scale cross-border trade
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