Malawi is among African countries making headway towards starting trading under the African Continental Free Trade Area (AfCFTA)’s Guided Trade Initiative (GTI).
The GTI is an AfCFTA’s pilot initiative which gives room to member states to conduct trade without charging each other customs duties.
Launched in October 2022, the facility will be used to test the AfCFTA’s operational, institutional, legal and trade policy environment while allowing meaningful free trade between countries that had met minimum requirements.
The government has said efforts have been deployed on implementing the AfCFTA agreement, including ratifying the agreement and submission of the Goods Market Access Offer in October 2023.
Under the GTI, Malawi will test private sector’s readiness to participate in trade under the AfCFTA regime and identify possible future interventions to increase intra-African trade and maximise the benefits of the AfCFTA agreement.
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The country has already highlighted key areas of focus for enhancing export trade under the initiative, according to Ministry of Trade and Industry spokesperson Mayeso Msokera.
Meanwhile, the government, with support from German development agency, GIZ, and other partners has moved to engage private sector players in identifying products and services eligible for participation in the initiative.
According to Msokera, to be part of the GTI list of pre-qualified participants from Malawi, firms should be duly registered with a minimum of five years’ operating in Malawi.
“We are looking at products as well as the firms themselves. This call is aimed at securing the private sector’s willingness to participate in the GTI and we are going to undertake some training on what it is all about and the value chains that we are looking at.
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“We are also going to engage some of the private sector companies that we know are capable of producing good products for the export market,” Msokera said.
willingness
He said Malawi eyes West and North Africa to supplement the Common Market for Eastern and Southern Africa and Southern African Development Community markets.
Participants are also required to be conversant with formal export and import procedures and documentation and be ready to consistently export large volumes of priority products from Malawi to any part of Africa.
Industry players are required to be capable of aggregating priority products from MSMEs for exportation.
Reacting, Malawi Confederation of Chambers of Commerce and Industry President Lekani Katandula rated Malawi’s preparedness as mixed.
“It is always going to be a mixed bag, with some players ready to take advantage of AfCFTA opportunities while others get endangered by incoming business.
“Industry can collectively gain from factors that improve overall competitiveness like improved access to power, finance, skilled labour (through more and better training and education) and industry-friendly legislation including competitive taxation,” he said.
The AfCFTA—the continent’s single biggest trading bloc—is among the African Union (AU)’s flagship projects for implementation of its ‘Agenda 2063: The Africa We Want’, and is aimed at bringing together all the 55 member states of the AU in an intra-African continental free trade area.
It would create a market of more than 1.3 billion people and a combined gross domestic product of up to $3.4 trillion.
If fully implemented, the AfCFTA could leverage intra-African trade and increase trade among member states by up to 110 percent.
In addition, the AfCFTA could lift up to 30 million people out of extreme poverty and up to 68 million people out of moderate poverty
