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Exports fall 24% within 5 years

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Felix Lombe

Malawi’s exports declined by 24 percent within half a decade to $781,981,000 (about K641.2billion at current rate) in 2020 from $1,035,099,000 (about K848.8billion) in 2016, figures from the International Trade Centre (ITC) Trade Map show.

Since 2016, export earnings have been falling sharply, except in 2019 when they rose to $912,983,000 from $879,825,000 in 2018. In 2017, export earnings amounted to $889,126,000.

The data also show that, in 2020 Belgium, was the largest market for Malawian exports valued at $162,938,000 followed by South Africa at $48,651,000 and the United Kingdom at $46,700,000.

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Kenya and the United States are ranked on position four and five on the list of Malawi’s export markets, having recorded $39,756,000 and $36,022,000, respectively.

The drop in exports in 2020 was perpetuated by corresponding significant drops in exports to markets such as Kenya which shrunk by 41.4 percent, Egypt by 51.5 percent, South Africa by 20.7 percent and United States by 27.8 percent when compared to 2019 figures.

However, the magnitude of the drop was cushioned by gains in markets such as Spain which grew by 360 percent, UK at 67 percent and Zimbabwe at 53 percent, among others.

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In an interview, Africa Institute for Corporate Citizenship (AICC) Chief Executive Officer Felix Lombe said the decline in imports versus export is a long-term trend and that several efforts have been deployed to reverse the situation but only to yield minimal results.

He said the country’s production base is so narrow with very limited export basket; in addition, the productivity is very low, meaning that the quantities are in low volumes to bring about a desirable trade balance sheet.

“Besides the low volumes, the composition of our exports is basically that of raw materials that have low value and are so vulnerable to price fluctuations at international market. Our ability to add value to raw materials is an issue of policy and infrastructure.

“We have energy deficiency and all in all, the years where trade balance was undesirable had extreme energy deficiencies,” he said.

Among other factors, Lombe said the 2019 political turmoil disrupted the country’s economic systems, which affected the export base.

He said the country should work towards creating an environment for improved productivity to leverage on the existing regional and international markets.

In a separate interview, Ministry of Trade spokesperson Mayeso Msokera attributed the trend to the general slowdown in production, particularly for tobacco, combined with decreasing prices.

He, however, said, through implementation of National Export Strategy II, Malawi’s trade balance is expected to improve.

“The government is now positioning and promoting more sustainable value chains beyond tobacco,” Msokera said.

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