The private sector is expected to benefit from the newly-launched Malawi Agricultural and Industrial Corporation (Maic), a financial entity that will be a vehicle for spearheading private sector development in Malawi.
Government has injected $25 million (about K18.4 billion) as seed capital for Maic and commissioned CDH Investment Bank to set mechanisms into the project which will partner with existing banks and financial institutions.
The establishment of Maic follows findings of a feasibility study conducted by independent consultants in 2013 and 2018 which found that government-led development finance institutions were plagued by governance hitches.
The study also found that the existing market financing gap hovers above K2. 8 trillion in various sectors and that the success of the Development Finance Institutions (DFI) largely depends on it being controlled by a private sector and having a strong corporate governance structure.
Maic has therefore been launched to rectify these problems through the establishment of a financial entity that will not be led by government but private institutions in the country.
Speaking on the sidelines of a press briefing yesterday, head of Maic Project Coordination Unit Misheck Esau, who is also CDH Investment Bank chief executive officer (CEO), said Maic will be a source of capital for underserved sectors of the economy such as small and medium enterprises (SMEs), thereby accelerating the country’s economic growth and development.
“One of the key benefits of this entity will be to mobilise financial resources into commercially viable businesses. The other thing that it will also do is to moblise skills and technologies that are needed to make the country more productive,” he said.
Also present during the press briefing were members of Maic project steering committee, including CDH Investment Bank director Naomi Ngwira and Malawi Investment Trade Centre CEO Clement Kumbemba.
Government has limited its shareholding entity to 20 percent to pave the way for the private sector to bring in their money.
The shares have been classified in four groups: group A has been given to private sector entities operating in Malawi, Group B is for the government agencies, Group C is for international investors and Group D is open shareholders in the companies enlisted by Malawi Stock Exchange.
Maic will be officially launched by government on November 28 at Bingu International Conventional Centre (Bicc) in Lilongwe.