Mozambique’s growing climate and biodiversity sectors are set to receive a major boost after FSD Africa awarded a £100,000 catalytic grant to Miarakap to support the expansion of the MITSIRY Biodiversity and Climate Fund into the country. The initiative is expected to help build a stronger investment ecosystem for small and growing businesses working in climate resilience, sustainable agriculture, forestry, fisheries and biodiversity protection.
The funding forms part of the UK-backed Mozambique Early-Stage Finance Programme and is aimed at unlocking more investment opportunities in sectors that are important for both economic growth and environmental sustainability. It also reflects increasing efforts by development finance institutions to support businesses that can help African economies adapt to climate change while creating jobs and long-term growth.
Miarakap, a Madagascar-based impact investment firm that manages the MITSIRY Biodiversity and Climate Fund, will use the grant to establish a formal investment platform in Mozambique.
The initiative is designed to solve one of the biggest challenges facing Mozambique’s green economy, which is the limited number of investment-ready businesses. While the country has strong potential in sectors linked to climate resilience and biodiversity, many small businesses have struggled to attract early-stage funding and technical support needed to grow.
The grant will therefore focus on building the foundations needed for long-term investment. Part of the funding will go towards recruiting a locally based investment manager who will help identify and support promising businesses across Mozambique. The funding will also cover regulatory and structuring work needed to establish a strong local presence and ensure the investment platform operates effectively within the country’s market conditions.
Building a Stronger Green Economy
A major focus of the programme will be the development of a pipeline of businesses that are capable of attracting future investment. Instead of waiting for opportunities to emerge naturally, the initiative will actively engage with entrepreneurs and businesses operating in environmentally important sectors.
This includes enterprises involved in sustainable agriculture, forestry, fisheries and climate resilience. These sectors are considered critical to Mozambique’s economic future because they support livelihoods, food security and environmental protection. However, they have often lacked access to the type of patient early-stage capital needed to grow sustainably.
By helping businesses become investment-ready, the MITSIRY Biodiversity and Climate Fund hopes to prepare them for larger future investments from both private investors and development finance institutions. The support is also expected to improve business capacity, strengthen local entrepreneurship and encourage more climate-focused innovation across the country.
The programme could also create wider economic benefits by helping businesses expand operations, create jobs and strengthen local value chains in rural and underserved areas. In the long term, this may contribute to a more resilient private sector that is better prepared to respond to climate-related challenges.
A Long-Term Investment Strategy
The £100,000 grant is part of a broader strategy by FSD Africa to support sustainable finance and climate investment in the region. It complements a recently approved $5 million investment from FSD Africa Investments into the wider MITSIRY Biodiversity and Climate Fund, which also targets Madagascar and Comoros.
Together, the funding combines early-stage ecosystem development with larger-scale growth capital. This approach is intended to reduce investment risks in frontier markets like Mozambique and encourage more investors to participate in climate-focused sectors over time.
FSD Africa’s support is designed to act as catalytic capital, meaning the funding is intended to unlock further investment opportunities rather than operate as a standalone financing solution. By supporting early market development and generating proof of concept, the programme aims to attract additional private and institutional investors into Mozambique’s green economy.
The partnership between FSD Africa and Miarakap highlights growing confidence in the potential of climate-positive businesses in Southern Africa. It also demonstrates how targeted development finance can help address gaps in early-stage investment ecosystems while supporting sustainable economic growth.
