Firm eyes K37bn in commodity exports
The Export Development Fund (EDF) says it will facilitate the export of 50 000 metric tonnes of various agricultural commodities to earn Malawi $50 million (about K37 billion) this year.
According to EDF managing director William Matambo, the 50 000 metric tonnes which does not include the exports under trade finance, will be exported under the firm’s commodity market making (CMM) window.
He said EDF has identified markets mainly in East Africa and the Southern African Development Community (Sadc) countries where commodities such as groundnuts, soy beans and various types of beans, pigeon peas, rice, bird’s eye chilli, and paprika are in high demand.
“There are already some small and medium enterprises [SMEs] that will benefit from the exports since we have agreements to buy whatever they will produce this year for export,” Matambo said.
Other than the regional markets Matambo said EDF has also found potential markets in the Middle East and Asia but the main challenge will be the lack of capacity of Malawian farmers to meet the demand due to the country’s production volumes.
National Small and Medium Enterprises (Nasme) national coordinator William Mwale said it is pleasing that EDF is taking a lead in empowering SMEs to benefit from export markets.
However, he said there is need for EDF to provide financing for value addition as more jobs will be created locally.
“We appreciate that EDF is the government machinery tasked to stimulate private sector-led exports. While some of our members are benefitting from the EDF initiative, there are others who feel that their conditions are not favourable to SMEs growth. We hope that moving forward, loan conditions will be softened to reach more SMEs,” Mwale said.
Matambo said the fund is also conducting studies to determine the comparative and competitive advantage of various commodities with a view to inform EDF’s interventions and determine value chains over which Malawi would have a competitive advantage internationally.
The fund has also started undertaking project preparation services which will see many SME proposed projects being passed through the assessment process and eventually graduate into bankable projects.
EDF is a development financial institution whose major objective is to increase the productive potential of the country through provision of finance, equity participation, or credit guarantees and advisory services to help set up, expansion and modernisation of viable enterprises in the medium and large scale enterprises sector.
The Fund aims to ensure the country’s vast export potential and business opportunities are exploited in order to generate foreign exchange for the country. n
