A peak-up in agricultural market activities could help propel economic growth and contribute towards quick recovery from pangs of the Covid pandemic, the Reserve Bank of Malawi (RBM) says.
Markets for commodities such as tobacco, Malawi main export crop, cotton and maize opened between April and May, time the local economy was staggering due to the Covid pandemic.
In its Monitory Policy Report for July, RBM says commercial banks’ credit to the private sector improved due to agricultural markets pick-up.
“The upsurge in credit to private sector was in tandem with the rebound in economic activities as the agricultural marketing season progressed during the period,” the report reads.
Another report from the central bank on National Payment Systems shows that, overall, performance of payment channels increased as a result of a surge in economic activities following the onset of the markets.
Malawi is a landlocked country heavily dependent on exporting raw agricultural produce.
Investment and advisory firm Nico Asset Managers, a subsidiary of Nico Group, also says the onset of agricultural markets has breathed life into the local economy.
In its 2021 Mid- Year Economic Report, the firm says the arrival of Covid vaccines and good agricultural markets project a gradually favourable economic outlook.
“The ongoing vaccination campaign, coupled with the above-average agricultural production during the 2020/21 season, as well as recovery of the global economy, provides optimism for economic turnaround,” the report reads.
As of week 16 of the tobacco marketing season, Malawi has realised $188.6 million while the cotton market closed last month with stakeholders describing it as satisfactory.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.