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Traditionally, Malawi is not recognised as having much investment potential, but that perception is changing radicallyMalawi promotes itself as “The Warm Heart of Africa”. It sees its greatest asset as its people, who are friendly, kind and ready with a smile.
A tourist attests to this, saying, “I have never felt so welcome anywhere. I thought I’d come home to a place I had always known.”
For this reason, as well as the natural beauty of its scenic plateaux, lakes and rivers, tourism has considerable potential in Malawi. From the rolling highlands in the north, to the dramatic rapids and falls of the River Shire in the south, from forest hideaways, to its vast inland lake – Malawi offers the tourist a great deal of diversity.
Lake Malawi alone offers stretches of white palm-fringed beach, diving to explore the treasures of the third largest lake in Africa, water sports, as well as African safaris and cultural experiences in the fishing villages.
While there are several lodges along the lakeshore and various other places, there is opportunity for the development of world-class, eco-friendly accommodation and facilities. Various sites have already been earmarked at such settings as waterfalls, islands and beaches with attractive rocky outcrops.
Malawi’s population is largely rural, comprising 85% of its 12 million citizens.
There are only four cities. Lilongwe in the central region is the capital, Blantyre in the south is the commercial hub, just north of Blantyre is the academic centre of Zomba, and Mzuzu is in the north.
It is understandable, therefore, that agriculture forms the basis of the Malawian economy. Tobacco, sugar, tea and coffee are the main exports, with subsistence farmers also growing maize, millet, sorghum, rice, fruit and vegetables.
Only 12% of Malawi’s gross domestic product is accounted for by manufacturing.
Adding value to agricultural products through processing is an obvious gap in the market.
Food security has been identified as a critical issue in Malawi. But because of its vast water resources in its lakes and rivers, making up one-fifth of its area, it has the capacity to not only feed its own people but also the region. Irrigation would make this possible.
According to Vincent Nkhoma, vice consul of Trade and Investment at the Malawi Consulate in South Africa, currently only 2% of crops is under irrigation. This would all change under a project called the Greenbelt Initiative, in which areas up to 20 kilometres from a water source would be available to be irrigated. Productive agricultural land would increase by one million hectares.
This will benefit the smallholder, who has already gained from government subsidies.
But it will also benefit commercial farmers whom Malawi is hoping to attract from neighbouring countries, bringing with them not only their farming expertise but their knowledge and implementation of the marketing value chain.
Nkhoma also highlights an ambitious $6-billion project shared between Malawi, Zambia and Mozambique to open up a waterway from Lake Malawi along the River Shire through the Zambezi River to the Indian Ocean. Thus effectively negating Malawi’s “landlocked” status.
With a waterborne transport system and access to the sea, Malawi will have the infrastructure it requires to transport its produce and goods to both regional and international markets.
President Bingu wa Mutharika was elected in 2004 and now leads a politically stable, multiparty democracy.
His government actively promotes private and public sector partnerships.
Legislation and policy is favourable to foreign investment. These include few licensing requirements, no price controls, reduced taxes and access to local financing.
The Malawi Investment Promotion Agency facilitates investment opportunities into the country. It won the 2008 Investment Agency of the Year Award organised by Africa Investor.
This indicates that despite Malawi traditionally being viewed negatively as an investment option, that perception is beginning to change.
Admittedly, the road network in Malawi requires upgrading. In response, the African Development Bank has recently agreed to a $60-million loan and grant agreement to improve, among others, the Nacala Road Corridor and to rehabilitate the Blantyre-Zomba Road.
Malawi will also need to improve its telecommunications, its image regarding crime and corruption, as well as the perception of its accessibility. These are some of the challenges to investment, but should not negate the value and opportunity.
Largely hidden from the view of the world, Malawi has to raise awareness of what it can offer to tourist and investor alike. A music festival in October, called Lake of the Stars, aims to do this. It showcases music as diverse as Afropop, reggae, folk, and international DJs, along the beautiful lakeshore. It also purposes to raise funds for charity as well as contribute to the Malawian economy.
Of course, we cannot but mention that Malawi has been brought to the public’s attention through the celebrity status and accompanying media focus of the diva, Madonna. She has helped shine a spotlight on Malawi and we can hope that Malawi will capitalise on this for its own future development.
Leigh Harrison
SHOWCASING MALAWI
Malawi’s president scoops an award for his homeland
The 2009 Southern Africa Drivers of Change award winners were announced on 29 October 2009 at Summer Place, Hyde Park in South Africa.
Among the 2009 Southern Africa Drivers of Change who were honoured, was Dr Bingu wa Mutharika, President of the Republic of Malawi.
In the government category, His Excellency Dr Bingu wa Mutharika was recognised for changing Malawi from a country in perpetual food deficit to one that is entirely food-sufficient.
The boom in this sector has had a direct impact on millions of poor people. Under his leadership, poverty in Malawi has declined from 58% to 42% in five years.
Through his direct involvement in turning around Malawi’s future, he is building new confidence and hope among the citizens of Africa in their governments.
