Malawi is tilting towards exporting more to regional peers than it does with countries overseas, recent statistics from the National Statistical Office (NSO) show.
The information shows that four out of five top export destinations for Malawian products in 2022 were African countries.
This is compared to the 2021 trend where only two African countries were among the top five importers of Malawian products.
According to the statistics, in 2022 top five export markets for Malawi included Belgium, with a record K141 billion export earnings; Tanzania, with K83.1 billion export earnings; Kenya, recording K60.7 billion, South Africa registered K56.9 billion; and Zimbabwe bought K47 billion worth of goods from Malawi.
However, in 2021, the top five export markets were Belgium at K111.5 billion, India at K61.6 billion, Tanzania at K57 billion, South Africa at K52.9 billion and the United Arab Emirates at K37.3 billion.
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Total exports increased to K882.5 billion in 2022 from K809 billion in 2021.
However, aggregate exports to the African continent were only at K370.2 billion in 2022.
In an interview on Wednesday, Malawi Confederation of Chambers of Commerce and Industry (MCCCI) President Lekani Katandula said the trend could be a result of supply chain disruptions stemming from the Covid pandemic.
“International shipping costs rose sharply during the Covid pandemic, which made long supply chains less attractive and business shifted towards closer markets. These shipping costs are falling again; so, we could see further rebalancing of the exports mix if this is sustained,” Katandula said.
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In a separate interview, Malawi University of Business and Applied Sciences based economist Betchani Tchereni said Malawi must embrace the South-South trade initiative as enshrined in the African Continental Free Trade Area (AfCTA).
“It is obvious that there are more and easier trade benefits from the initiative compared to relying on more tedious and really strenuous markets outside Africa.
“The country must focus on its competitive advantages and push forward to increase the exports even more, agro-processing being one of them, so that we can be adding value and earning more from our exports,” Tchereni said.
Ministry of Trade spokesperson Mayeso Msokera said the development implies that the value of Malawi’s intra-African exports is increasing.
He said it is mainly on the account of growth in intra Africa export products such as groundnuts, soybeans and oil cake.
“This is a positive development and in line with the aspirations of the AfCFTA, which aims to significantly accelerate the growth of Intra- Africa trade in order to boost industrialisation, development of Africa’s natural resources and commodities.
“Malawi should focus more on not only increasing exports into existing traditional markets but also penetration into new markets on the continent beyond the Comesa and Sadc regions,” Msokera said.
The AfCFTA will be the largest single market in the world with a combined gross domestic product of approximately $3.4 trillion.
It is expected that the AfCFTA will reduce tariffs and non-tariff trade barriers for goods and services and enhance regional competitiveness.
Eventually, this will promote industrial development through diversification and regional value chain development, agricultural growth and food security.
