The Malawi Confederation of Chambers of Commerce and Industry (MCCCI) says lack of industrialisation and the shrinking land available for agriculture are a stumbling block to the growth of the country’s economy.
Malawi’s economy is largely dependent on agriculture although the sector is beset with challenges which result in high commodity prices.
Speaking during the opening of the third Lilongwe Trade Fair last week, MCCCI councillor Andrew Chinguwo said Malawi also needs to work on energy challenges if the industry is to grow.
He said: ”The persistent lack of industrialisation is a stumbling block to our economy, which is largely dependent on rain-fed agriculture and unprocessed commodities that add relatively little value.
“As land available for agriculture keeps shrinking and the optimum level of productivity is reached, it is the industrial sector which acts as an engine for growth and provides employment to millions of Malawians who are currently unemployed or underemployed.”
According to Chinguwo, industry plays a vital role in development because it increases the value created in an economy by generating activities further down the value chain, from raw materials to finished products, down to the market.
He added: “Industrialisation boosts productivity by introducing new technologies and techniques and it also generates employment, increases the skills of the workforce, supports formalisation of the economy, diffuses improvements into the wider economy and tends to underpin social stability.
“Industrialisation can also improve the balance of trade by producing processed goods for export and creating local competition for imports.”
Chinguwo also said several developing economies, particularly in East Asia and parts of Latin America, have successfully transformed their economies through industrialisation and are acknowledged as newly industrialised countries (Nics).
Commenting on the trade fair, he said Lilongwe has become a major business centre, and that the number of small and medium enterprises (SMEs) that are the biggest source of untapped growth potential for the economy.
In his remarks, acting Principal Secretary in the Ministry of Trade, Industry and Tourism Joseph Mkandawire said industrialisation is crucial to any economy as it gives rise to utilisation of resources and promotes production of value-added products.
He said government puts emphasis on and supports industrialisation and trade competitiveness as drivers of the economy.
“Realising the challenges relating to industrialisation, government has instituted a number of business and industrial reforms in a bid to promote industrialisation. Industrialisation is essential to enable African countries, including Malawi, to trade among themselves and to benefit from free trade agreements,” said Mkandawire.
He also commended exhibitors for displaying high-quality products fit for the export market.
“What I have seen in the stands is awesome and if we can support these companies through the Buy Malawi Strategy, they can easily grow. The products I have seen can compete very well on the international market,” he added.
The fair was held under the theme Industrialisation: Basis for Trade Competitiveness.”
At least 30 companies, including Lilongwe Dairy, Rose Farms, Monsanto and Chombe Foods exhibited various products and services at the fair.