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MCCCI faults policy on falling export trade

The Malawi Confederation of Chambers of Commerce and Industry (MCCCI) has faulted government policies for the country’s dwindling export trade which it says has made businesses lose competition to countries in the region.

MCCCI president Carl Chokotho said in a written response to a questionnaire on Wednesday while a needs assessments which would display business opportunities is ongoing, the issue of capacity and restrictions are both pertinent and paramount to exports.

Chokotho: Local industries face many challenges

“The local industry has many challenges which are affecting production including and most prominent being utility issues, particularly power. Most of our neighbors trade in semi-processed or processed goods and there is little raw materials traded, except such commodities as maize and legumes. Manufacturing requires power and when we fail to supply competition takes over.

Policy issues also affect exports, thus the Control of Goods Act amongst others have placed restrictions on commodities for exports and whilst in 2017 Malawi could have increased trade to fellow Common Market for Eastern and Southern Africa [Comesa] countries, the window was lost and the trade imbalance continues to worsen,” he said.

The remarks follow recent revelations that Malawi’s share of trade with the 19-member Comesa has slumped to 1.9 percent this year from the previous year’s 2.8 percent. The trend over the past five years shows that Malawi’s share of trade in the trade bloc is dwindling.

This means that Malawi is not taking advantage of the big market in Africa which has a gross domestic product (GDP) of $657 billion and a population of 500 million people.

In the year under review, Malawi raked in $153.6 million in export with a 1.9 percent market share but spent $280.2 million on imports, gaining a 3.5 percent market share. This represents a trade gap of $126.6 million.

However, despite having policies, strategies such as the National Investment Policy, National Export Strategy (NES) and an updated micro small and medium enterprise (MSME) policy political will to implement the policies has been lacking.

In an earlier interview, National Working Group on Trade Policy chairperson Frederick Changaya also attributed the development to the country’s lack of comparative advantage which he said poses risks for Malawi to lose market share for various trade pacts.

Ministry of Industry, Trade and Tourism spokesperson Wiskes Nkombezi recently said there is need to tame the huge appetite for some imports that are domestically found.

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