Download WHY INVEST IN MALAWI?

2009 AFRICA BUSINESS CONFERENCE
TRADE AND INVESTMENT OPPORTUNITIES IN MALAWI
PRESENTED BY
MR PATRICK MPHEPO (FIRST SECRETARY (INVESTMENT))
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COUNTRY INFORMATION
 Location:
South-eastern Africa
bordered by Tanzania to the north and, northeast, Zambia to the west and Mozambique to
the south-east, south west and south.
 Land Area:
118,484 sq km 45,747 sq mi)
(Size of the State of Pennsylvania)
 Time Zone:
GMT + 2 hours
 Population: 13.6 million
 Literacy Rate: (2007) 64%
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COUNTRY INFORMATION
 URBANIZATION
:
19 % (2008)
 OFFICIAL LANGUAGE :
English
 NATIONAL LANGUAGE :
Chewa
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NATURAL RESOURCES
 Arable land, water, fish, wildlife, forestry
 Minerals
 Limestone, Uranium, Bauxite
Coal,Phospahtes, Monazite, Strontianite,
Vermiculite and other Gemstones
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ECONOMY
 Currency:
Malawi Kwacha
 Exchange Rate (March 2008):US$ 1.00 =MK140.00
 GDP US$ 2.43 billion
US$ 2.63 billion
(2007)
(2008)
 GDP Per Capita US$304
US$208
(2008)
(2004)
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ECONOMIC INDICATORS
 GDP Annual Growth Rate (2008): 8.7%
(2007) : 8.1%
 Price Inflation Rate
(2008) : 8.2%
(2007) : 7.9%
 Interest Rates
(2008) :15 %
(2007) : 22.5%
source – EP&D
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ECONOMIC STRUCTURE
GDP Share Per Sector
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ECONOMIC STRUCTURE
 Agriculture is the backbone of the economy
generating about 80% of foreign exchange and 80%
of employment
 Focus on diversifying the sources of economic
growth; manufacturing; mining, tourism etc
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TRADE GOALS
 Increasing production and trade of primary
products with assured markets;
 Increasing in production and trade higher value
products e.g coffee, macadamia nuts;
 Increasing production and trade of value
additioned and processed e.g textiles and
garments
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TRADE
 Major Exports:
Tobacco, tea, sugar,
Other Exports
Apparels, cotton, groundnuts, coffee,
macadamianuts, timber, pulses, rice,
groundnuts, maize etc
Major Imports
 Electrical equipment and machinery, major
petroleum products, fertilizer, motor vehicles,
iron and steel, pharmaceuticals.
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IMPORTS AND EXPORTS
Year
Imports (CIF) US$
Export (FOB) US$
2006
889.3
446.5
2007
1,272.0
704.6
2008
1,436.6
1,003.6
MAJOR IMPORT AND EXPORT SOURCES
Import Partners
Export Partners
South Africa 48.5
South Africa 18.0
Mozambique 16.9
UK
12.2
UK
7.9
Germany
7.6
Zambia
Tanzania
4.8
4.6
USA
Egypt
7.0
6.9
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TRADE OPPORTUNITES IN MALAWI
1.
Increasing Trade in Traditional Export Products
with Established Markets




2.
Tobacco
Tea – Second largest producer in Africa after Kenya.
Sugar
Cotton, rice, ground nuts etc
Increasing Trade in AGOA Products

Textiles, garments and apparels

Increase exports of agricultural products; coffee,
macadamia nuts, paprika etc
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TRADE OPPORTUNITES IN MALAWI
3.
Increasing Export Diversification to Higher Value
Products

Arabica Coffee; Macadamia Nuts; Bird’s Eye Chilies and
long Cayenne; Beans and pulses; Soya Beans; Paprika;
Cut flowers; Maize, spices
4.
Increasing Trade in Value Addition and
Processed Products
5.
Increasing Domestic and Regional Trade
through Imports Substitution Goods
Chicken, eggs

4.
Increasing Export on Non-Agriculture


Hand loomed and folkloric articles i.e. curios
Minerals, rubber, timber
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Mzuzu Coffee Plantation at Misuku
Hills
Coffee in
the Field
Coffee
Processing
Mzuzu Coffee
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INVESTMENT GOALS
 Increase investment in production of exports;
 Boost investment in export products - oriented
sectors;
 Boost investment in manufacturing industry to
encourage value addition;
 Boost investment in domestic and regional
market products for imports substitution;
 Encourage investment in infrastructure
development
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WHY INVEST IN MALAWI?
 A Liberalized Economic and Political
Commitment to Private Sector

Market determined interest rates;

Floating currency;

Foreign currency denominated accounts for regular
exporters 60% retention;

Full repatriation of profits and dividends;
 Competitive Investment Incentives
WHY INVEST IN MALAWI?
 Politically Stable Country

A Multi – party fledgling democracy with three arms
of Government

Malawians are peaceful and friendly people

No history of civil war

Has had four peaceful multi-party democratic
elections in 1994, 1999, 2004 and 2009
WHY INVEST IN MALAWI?
 Preferential access to world markets under
COMESA, SADC, EU, AGOA;
 Hard Working, trainable, reliable and English
speaking labour force;
 Serviced Industrial Estate & Export Processing
Zones;
 Functional and constantly developing
infrastructure
INVESTMENT OPPORTUNITIES
1. Investment in Agriculture
1.1 Increasing Agro processing
1.1.1 Integrated Cotton Industry to take advantage
of AGOA





Cotton commercial farming through contract farming –
demand of 100,000 MT
Ginning, spinning, weaving
Textiles, and accessories
Cotton yarn manufacturing
Garment Manufacturing
1.1.2 Fruit Processing and Vegetables Canning

Establishing of fruit juice concentrate processing
facility using local-grown fruits

Establishing of horticultural centers for
processing, packaging and storage of organic
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vegetables
INVESTMENT OPPORTUNITIES
1.1.3 Increase production and processing of
higher value export products
 Coffee, Macadamia Nuts, Paprika, Soya
beans, Sesame. etc
1.2 Increase production of traditional export
products through commercial farming

Large estate farming through irrigation
1.3 Increase production of domestic and
regional markets products for import
substitution

Livestock and dairy

Poultry and piggery
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INVESTMENT OPPORTUNITIES
2. Increase Investment to Utilized Natural
Resources
2.1 Mining
◦ Uranium
◦ Limestone over 25 million tonnes
◦ Monazite/strontianite 11 million tonnes
◦ Graphite 2.8 million tonnes
◦ Phosphate Carbonatite 2.0 million tonnes (8.8 million
tonne residuals)
◦ Bauxite: over 25.6 Million tonne reserves
◦ Others: Vermiculite, Gypsum, Glass sands, iron
sulphides, heavy mineral sands, ceramic clays.
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INVESTMENT OPPORTUNITIES
2.2 Phosphate Fertilizer
Demand, 200,000 metric tons per annum
2.3 Fish and Crocodile Farming
 Setting up of large scale fish farms for
commercial fishing e.g Chambo (Tilapia
fish)
2.4 Wood and Rubber Products
 Rubber Trees
 Forestry Plantations –Timber, concession
management
 Timber and rubber production industries
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Malawi Cichlids
Chikangawa Tree Plantation
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INVESTMENT OPPORTUNITIES
Increase Infrastructure Development
3.1 Transport
3.
 Shire Zambezi Waterway Project –Open Malawi
into Indian Ocean through Public Private
Partnership (PPP)
 Provision of river/sea bargers
 Air and rail
 Rehabilitation of Sena Railway link between
Malawi and Mozambique
3.2 Housing and Building Projects
High demand for affordable housing,
office blocks construction and shopping malls
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INVESTMENT OPPORTUNITIES
3.3 Information and Communications
Technology and Telecommunications

Broadband telecommunications infrastructure
 Installation/expansion of optic cable with
connectivity links to other countries

Information Technology Centres
 Data processing hubs
 Broadband Internet Services
 WIFI and Intranet providers
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INVESTMENT OPPORTUNITIES
3.4 Tourism Infrastructure Development
 Wildlife Tourism
 Concessions for Management of Wildlife National parks and
investment in construction of Game Lodges.
 Tourism Lake Malawi Shore Resorts
(Third Largest Fresh Water Lake)
 Cape McClear (Lake Malawi National Park – unique
ornamental fish species.
 Eco Tourism Products

Machewe Falls

Likhubula Mountain Resort (Mulanje Mountain, highest in
South Central Africa at 3000 meters).
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Kande Beach
Malawi Cichlids Species
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MALAWI INVESTMENT PROMOTION
AGENCY (MIPA)
 Parastatal organization created through an act of
parliament to promote, attract, encourage, facilitate and
support both local and foreign investment
 Facilitates all aspects of investment process in Malawi
 Operates as one stop investment Centre through an
interministerial committee - the investment approval
committee
 10 calendar days for applications processing
INVESTMENT PROTECTION
 Protection of foreign investors’ assets guaranteed
by constitution of Malawi
 Member to Multilateral Investment Guarantee
Agency (MIGA)
 Signatory to the international centre for settlement
of investment disputes
For Further Details Contact:Embassy of the Republic of Malawi
Location: 1029 Vermont Avenue, N.W
Suite No. 1000, Washington DC 20005
Tel: 202 349 - 9567, 202 721 -0270
Email: [email protected]
web: www.malawiembassy-dc.org