When I worked for Blantyre Print and Packaging in the 1980s, Lever Brothers (now Unilever) was our major client. We used to supply Surf and Vim cartons, Lifebouy and Sunlight wrappers and a whole range of other wrappers to their busy factory in Limbe. Besides soap products, Lever Brothers used to manufacture cooking oils (Covo and Kazinga). They later introduced Fair and Lovely Lotion, among other cosmetics.
When I last checked, what used to be Unilever’s busy factory had been occupied by a different company because all manufacturing had ceased there. Unilever now imports all their merchandise. And so does Bata, and scores of other local companies, by the way.
Once upon a time, Malawi used to be a country with a relatively solid manufacturing base. I remember Blantyre Print and Packaging supplying labels to Shire Clothing, a company that used to make garments and beddings, strictly for export, in Lilongwe. At that time, government was implementing what were known as export processing zones. It was not permissible to sell any item from such zones locally. They were meant strictly for export.
The economy was bad at that time, by world standards, but it was many times better than it is today. The currency was very strong. When I first drove a family vehicle from Blantyre to Lilongwe in or around 1992, I filled it with K200 worth of fuel. On that fuel, I was able to get to Lilongwe and to do some local running in Lilongwe. If anybody attempted to buy K200 worth of fuel today, the fuel attendant would presume them to be mentally disoriented.
We have now become a nation of retailers. Unilever is now a retailer, as is Bata and others that used to engage in manufacturing. All they do now is bring in goods from elsewhere to sell locally. Production is no longer part of the equation. With or without our knowledge we have lost a very important ingredient of trade, namely production.
It is production that creates wealth. Retailing does not, and neither does banking. These are very important services but they simply do not create wealth. They only shift it around. As a result of our losing production we have essentially become less wealthy than we were previously.
Hetherwick Press of the Blantyre Synod closed shop some years back. The premises were converted into offices meant to be let out to people running essentially non-production businesses—consultancies, for example. Yes, we need consultancies in all fields of business, but consultancies, like banking and retailing, legal and other services, do not create wealth.
British American Tobacco (BAT) used to produce a variety of cigarette brands in Malawi, operating from the yard across the road from The Polytechnic. The premises are now a glamorous shopping mall, but the dominant form of business there is, guess what, retailing.
In his book titled MRP II: Unlocking America’s Production Potential, Oliver Wright said: “Production is the goose that laid the golden egg”. It is extremely unfortunate that we have strangled and slaughtered the goose, although we still expect to continue getting golden eggs. It does not surprise me that Malawi is ranked number one on the poverty scale. That this should happen to a country that has never been at war is baffling. But it is reality, albeit sad reality.
Searching within Africa, one lands on Rwanda, a country that a few years ago emerged from a horrendous holocaust, arguably one of the worst in living memory. Today Rwanda is taking deliberate steps to encourage local production. Last year alone, three trade fairs branded ‘Made in Rwanda’ were held in that country to buttress local manufacturing. On the software front, the Rwandese government has instituted lucrative incentives to software developers aimed at encouraging innovation in that area.
My son, an ICT enthusiast, bemoans the little respect accorded to software developers in this country, by contrast. Despite the elaborate training programme they undergo, ICT people are regarded by most employers as little more than ‘cable guys’, meant to help secretaries sort out the most basic of problems on their printers or on Microsoft packages. My foot!
It is hardly surprising that the German company, Volkswagen, is now setting up an assembly plant in Rwanda. As the saying goes, ‘opportunity dances with those who are already on the dance floor’. Malawi needs to quickly get back on the dance floor insofar as manufacturing is concerned. n