Malawian exporters are finding it hard to benefit from preferential market access to a number of developed and developing markets due to inadequate productive capacity and overlapping membership.
Ministry of Industry, Trade and Tourism chief investment and promotion officer George Kanthiti, said this in Thyolo on Friday during the Enhanced Intergrated Framework (EIF)Project media sensitisation workshop.
Said Kanthiti: “Malawian exporters are able to benefit from preferential market access to a number of developed and developing countries. The challenge before us, however, has been that we lack productive capacity to take full advantage of these opportunities by producing goods and services of the right quantity and quality.
“The private sector in Africa and certainly Malawi have often played a passive role in integration processes”.
According to Kanthiti, integration in Africa is only at 11 percent against 50 percent for developing Asia, 21 percent for Latin America and the Caribbean and 70 percent for Europe.
In her remarks, director of trade in the ministry, Christina Zakeyu said Malawi is mostly losing out due to the lack of value addition in its export commodities.
Malawi has been party to several trade agreementssince 1956.
Malawi has bilateral trade agreements with Mozambique, Zimbabwe, South Africa, Botswana and China and is also a member of the Common Market for Eastern and Southern Africa (Comesa), Tripartite Free Trade Area (TFTA) and the Southern African Development Community (Sadc) at the regional level.
On the global front, Malawi is party to the World Trade Organisation (WTO), the European Union (EU), India, Japan and United States.
Under the agreements between Malawi and Botswana Customs Agreement (1955), Zimbabwe Trade Agreement (2004) and Mozambique Trade Agrrement (2005); the parties involved are obliged to grant each other’s exports duty-free treatment except for spirits while the trade agreement between Malawi and South Africa (1990), the country’s exports are accorded free treatment while imports from South Africa to Malawi are dutiable at the normal rates.
Available statistics from National Statistical Office (NSO) indicates that as at September 2016, Malawi’s trade deficit stood at K52 billion up from K31.5 billion during the same period last year.n