Business slow, industry says
Players from different sectors of the economy have rated the first six months of 2021 as difficult for business, mainly attributing the development to the Covid pandemic.
This comes as the pandemic has led to an ease in economic activities, amid restrictions such as travel bans, wreaking havoc on the performance of most sectors.
However, industry players we spoke to said despite an ease in Covid cases lately, as well as lifting of some restrictions by the government, businesses were still feeling the pinch.
National Association of Small and Medium Enterprises Chairperson William Mwale said many businesses performed miserably in the first half as expenditure outpaced revenue in most instances.
“Most of the manufacturers cannot pay their employees, electricity bills, rentals and many other things. It has been a very difficult situation in the past quarter, but there is hope that things are picking up now. Business was also disturbed because of the elections which were going on in Zambia because we do a lot of trade with them,” Mwale said.
Tourism is another sector hard hit by the pandemic where over 300,000 people lost their jobs in 2020 alone.
Malawi Tourism Council Executive Director Richard Mdyetseni said the industry is yet to recover and that the first half performance remained volatile.
He, however, expressed optimism that business might pick up going forward depending on the rate of Covid vaccine uptake by Malawians.
The Malawi Confederation of Chambers of Commerce and Industry (MCCCI), an umbrella body for the private sector in the country, rated the first six months of the year as a mixed bag.
MCCCI President James Chimwaza said the private sector experienced mixed fortunes, with some even benefitting from the pandemic.
“Some businesses that deal in pharmaceuticals, especially Covid-related, experienced a boom, and there are some businesses that were suffering from grey market—where goods were coming in without paying duty, meaning the established companies were suffering, as a result these ones were saved by the closed borders for example there was less sugar smuggled in into the country during this period when borders were closed; so, local producing companies were protected,” Chimwaza said.
Notably, amid the underperformance of the other sectors, the banking industry has shown good performance, with recent financial statements for five Malawi Stock Exchange-listed commercial banks showing profitability in their half-year ended June 30 2021.