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Malawi government not happy with level of Agoa exports

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Minister of Industry and Trade, Joseph Mwanamvekha has said Malawi’s exports to the United States of America under the Africa Growth and Opportunity Act (Agoa) have been unsatisfactory and has challenged the country to increase its capacity in the production of goods that can be exported under the facility.

Mwanamvekha said in an interview that Malawi did not benefit enough from the market opportunities presented by the US under Agoa.

He said the country does not produce enough due to capacity problems.

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“One of the major reasons is our production, coupled with higher costs of transport logistics. Even if you look at markets around us in the region, we do not supply enough of our products though they are on higher demand,” said Mwanamvekha.

“The fact that we export raw products straight from the farm to the export market without adding any value means we can’t even industrialise and create jobs,” he said.

He explained that the result of exporting raw products is that local jobs are being exported as well.

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“And we don’t get enough foreign exchange earnings. We face perpetual price volatility on the international market and as a result, we continue to face unfavourable terms of trade,” said Mwanamvekha.

He said the biggest problem faced in the country is the mindset.

Mwanamvekha said as a country, we have for a long time thought of being helped out by donors.

“There is fatigue out there apart from the fact that our bilateral donors are also facing problems with their respective economies and these problems. To some extent, this affect our multilateral cooperating partners because they also get their funds from the same bilateral donors,” said Mwanamvekha.

He called for a change in mindset among Malawians so that when it comes to investment, we should not just think of foreign direct investment but also local investment.

“We can leap ahead in economic development when we intensify domestic investment. There are countries out there like Ethiopia and Egypt who are growing economically due to domestic investment,” he said.

Mwanamvekha also said Malawians should start thinking of joint ventures and partnerships for investment.

“This is the area that is not well entrenched in our economy and mindset. We need partnerships with foreign investors but more importantly partnerships among Malawians are important as well,” he said.

He also said Malawians should change the way they do things.

“Many Malawians just work between October and March. We need to find a way of filling the gap and use this precious time productively,” said Mwanamvekha.

“This would help turn the tide of seasonality in Malawi’s economy where we have a lean period and another period of plenty characterized by depreciation and appreciation of the kwacha respectively. This, coupled with time mismanagement by workers in both the private companies and public sector, makes Malawi lose a lot in labour productivity,” said Mwanamvekha.

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