4% Industry 16% Figure 2.1: Composition of the GDP of Mozambique, 1996 and 2004 (%) 19 1996 Agriculture 30% Agriculture 23% Services 50% 2004 Fishing 2% Services 48% Fishing 4% Industry 16% 131. Industry 27% Growth in the agricultural sector as a percentage of GDP dropped drastically 2004 from 30 per cent in 1996 to 18.8 per cent in 2001, and then recovered someAgriculture 23% what to 23 per cent in 2004. The growth of not only Mozambique’s industrial sector, but also its entire economy over this period, was driven mainly by conServices Fishing struction, of which the share of the GDP increased from 6.6 per cent in 1996 48% 2% to 11.7 per cent in 2001. This was primarily due to the benefits received from FDI since 1999 in the aluminium-smelting megaprojects (Mozal I and II) of BHP Billiton. In fact, a number of other megaprojects in natural gas (Sasol), titaIndustry nium 27% mining (Moma) and the Cahora Bassa hydroelectric dam and generating station, among others, were the result of considerable private capital inflows attracted by the new, reformed environment since 1992. 132. The megaprojects are considered to be Mozambique’s main source of growth. Over the period from 1996–2006, total investment in Mozambique grew at an average rate of 11.6 per cent. This was 3.1 per cent higher than the country’s average real GDP growth rate 20 for the period and 1 per cent lower than the growth of net exports. Making the growth in total investment appear quite serrated since 1996, FDI experienced sharp increases in 1999 and 2002 (8.5 per cent of the GDP), while gross capital formation experienced intense volatile phases. This steep incline in 2006 was mainly due to strong growth in public investment (51 per cent), which was recognised for its contribution towards reducing poverty throughout the period. 21 133. However, it should be noted that Mozambique’s meteoric growth has resulted from an extremely small base. In 1997, the country’s per capita GNP was still the lowest in the world at US$90, and much of the health and education infrastructure had yet to be rebuilt, virtually from scratch. Nonetheless, sound economic management, massive international debt relief, and great investment in human capital have been quite successful in alleviating poverty in the country. 19 International Monetary Fund (IMF). 2005. Republic of Mozambique: Selected issues and statistical appen- dix. IMF Country Report No. 05/113. Washington DC: IMF, page 7; Kulipossa (2006:44). 20 Between 1989 and 2006, real GDP growth averaged 7.5 per cent, which is almost twice the comparable figure in SSA. 21 World Bank. 2007. Promoting shared growth through empowerment of citizens and institutions: Mozambique Country Partnership Strategy, 2008–2011. Washington, DC: World Bank. 72 A P R M COU N T RY R EV IEW R EP ORT NO. 11