The US Government has said it will not lift the tobacco export restriction on Malawi until it proves the elimination of forced and child labour practices in tobacco production.
The US Government’s position comes a day after some tobacco buying companies confessed that some of their last season shipments are still being withheld in the United States and Malawi due to the existing World Release Order (WRO).
In a brief response on Wednesday, United States Embassy public affairs officer Douglas Johnston said the US Government still stands by the restriction.
He said: “The WRO is still in effect and will remain in effect until Malawi can demonstrably prove the absence of forced labour, including child labour, in its tobacco supply chain.
“In the meantime, individual tobacco importers can apply for waivers by proving their individual supply chains are free of forced labour.”
Alliance One Tobacco Malawi corporate affairs manager Francoise Malila confirmed in a written response that some shipments were being withheld locally and in the United States, but did not disclose quantities, saying it was confidential information.
She said: “As a result of the WRO, we have shipments on hold in both the United States and in Malawi. We are actively engaged, both internally and externally, to respond to the WRO as efficiently and effectively as possible.
“While we do not know how long it will take for the shipments to be released, it is our hope that the WRO is lifted soon, so that it does not negatively impact our operations this season.”
But Tobacco Commission chief executive officer Kayisi Sadala on Wednesday, while admitting that the order is detrimental, said the issue was beyond the commission as an industry regulator.
“Since the issuance of the order, government is taking necessary interventions on the matter,” he said.
Ministry of Agriculture and Food Security Principal Security Gray Nyandule Phiri on Wednesday said the ministry was yet to get latest feedback from talks with the US delegation on the matter.
Nyandule Phiri, however, said the onus is on tobacco merchants to provide proof to the Customs and Border Protection (CBP) that their tobacco was produced under forced and child labour free environment.
He said: “The WRO issue directly concerns the merchants. They are supposed to furnish the US Government with information not necessarily us as government.
“It will be dealt with on a merchant’s case by case basis. As of now, we haven’t been given any feedback from our earlier talks with US Government delegation.”
He, however, said he had been following up with tobacco buying companies if they submitted their evidence.
Following the WRO, shipments from Malawi are detained at the port of entry where US authorities scrutinise them to ensure that the tobacco was not produced using child labour.
By having the WRO intact, it means the country’s tobacco exports will be challenged to enter US markets.
Earlier, industry sources said the US Government’s decision puts at stake Malawi’s eight million kilogrammes of tobacco annually destined for the US market valued at $29 million (about K22 billion) based on the past six years average.
While industry players are dismissing the existence of child labour, the 2017 National Child Labour Survey undertaken by National Statistical Office showed that 38 percent of the country’s children aged between five and 17 are engaged in child labour.
Tobacco is the country’s main foreign exchange earner contributing 60 percent and accounting for about 25 percent of tax revenue.
In November 2019, the US Government, through CBP, issued a WRO, restricting importation of tobacco from Malawi on the premise of use of forced and child labour in tobacco production.
Meanwhile, the tobacco market in Malawi opened on April 20 in Lilongwe while Limbe Auction Floors opened on April 27.