MBL Holdings Limited, a diversified business group, has said Malawi has potential to attract large-scale foreign direct investment (FDI) if it continues with aggressive reforms to improve the ease of doing business.
MBL Holdings Limited chief executive officer and chairperson Leston Mulli said in an interview in Nairobi, Kenya last week on the sidelines of the Sixth Tokyo International Conference on African Development (Ticad VI) in the context of reforms the East African economy has undertaken to attract FDI.
Mulli was part of the business delegation from Malawi that courted Japanese investors at the Ticad VI, the first to be held on African soil.
According to the 2016 World Bank ease of doing business ranking, Kenya moved up 21 positions to 108 in the global investment competitiveness whereas Malawi moved three steps.
Said Mulli: “Kenya is moving forward and is pushing for reforms at a faster pace. The country is attracting big investors and their marketing in terms of tourism is aggressive.
“Malawi has potential to attract investment and we can also do as the Kenyans are doing. We have to cut on bureaucracy.”
For instance in Kenya, it only take less than three days to start a business whereas in Malawi it takes more than 30 days, a development that is frustrating to investors.
However, strides have been made to improve the environment through the opening up of a one-stop trade and investment centre in Lilongwe.
Mulli also cited the move by the Kenyan President Uhuru Kenyatta to sign into law the Bank (Amendment) Bill 2015 that requires commercial banks to charge a maximum of 14.5 percent on loans and caps lending rates at 400 basis points above the prevailing 10.5 percent Central Bank Rate (CBR).
The policy rate in Malawi is at 27 percent and banks charge interest rates at above 40 percent. n