Minister of Trade tasked to deploy a rapid strategy that tracks illicit exportation of Malawi’s produce

* Government to continue in establishing a digital platform for marking and tracking all commodities traded in our economy

* In March last year, I spoke about the need to support the local industry by encouraging the local buying of materials for Government officers such as police uniforms

* Yet, just last week, uniforms for police officers were captured at the airport, which means some in our midst do not take this policy seriously

By Duncan Mlanjira

President Lazarus Chakwera alluded in his State of the Nation Address (SONA) that some business players in Malawi’s agriculture sector are involved in illicit exportation of huge volumes of crops such as legumes to neighbouring countries and beyond.

This, he said, is done “with little to no forex coming back into the economy” and that his administration has tasked Ministry Trade & Industry “to work jointly with other agencies in deploying a rapid strategy that tracks the exportation of produce”, while at the same time government would continue “to make progress in establishing a digital platform for marking and tracking all commodities traded in our economy”.

“In March last year, I spoke about the need to support the local industry by encouraging the local buying of materials for Government officers such as police uniforms,” he said. “Yet, just last week, uniforms for police officers were captured at the airport, which means some in our midst do not take this policy seriously. But the policy remains in force.

“Unless you have a special waiver from my office, the procurement of uniforms by Government from outside the country is banned forthwith. I also order the Ministry of Trade & Industry to release a full list of products subject to a similar ban.”

In the quest to boost trade and local industry, Chakwera reported that:

* In conjunction with President of Zambia, Hakainde Hichilema, the One Stop Border Post (OSBP) at Mchinji-Mwami border was commissioned, which has already started easing and increasing trade and competitiveness, with clearance time for passengers and traders reduced by 70%;

* The Dedza-Colomue and Mwanza-Zobue facility is at 95% completion rate, and the Songwe-Kisumulu is at the mobilization stage. The Muloza-Milanje OSBP is currently at the design review stage, while funding approval for Chiponde-Mandimba has been granted by the African Development Bank;

* A National Single Window has been established which when fully completed will simplify and harmonize trade procedures, reduce the cost of doing business, improve revenue collection and enhance border controls;

* In December 2020, Chakwera Administration issued an MSME order to reserve the procurement of certain goods, works, and services by Government for local small and medium enterprises. Since then, 2,778 MSMEs have been registered and awarded them a total of 658 contracts worth K1.3 billion;

* In line with the National Export Strategy II, following the MoU signed with India in June 2021 for the export of 50,000MT of pigeon peas annually, this past year China granted 98% duty-free and quota-free market access, as well as an MoU on Sanitary and Phytosanitary to facilitate the export of groundnuts and soybeans.

“So far, we have exported 23,000MT of pigeon peas and 63,000MT of soya beans to India. We have also conducted trial exports of 1,200MT of maize flour and 900MT of rice to South Sudan.

“Currently, we are engaged in discussions with Tanzania and the Gambia for the export of 100,000MT of soybeans and 70,000MT of broken rice.

On the industry side, one of my Administration’s key initiatives is the creation of Special Economic Zones. Last year, I reported that we had identified four potential sites, namely Matindi, Chigumula, Dunduzu, and Area 55.

“I wish to report that in my interaction with the President of the African Development Bank at the COP 27 in Sharm El Sheikh in Egypt four months ago, I secured the Bank’s commitment to support this initiative. As such, the Minister of Trade and Industry is expected to submit a roadmap to me in the coming two weeks, followed by monthly updates until this initiative is a reality.”

On foreign affairs, the President said in the year under review, it was focused on development diplomacy through which key deliverables that have resulted from this include the signing of an Accord for a healthier world with Pfizer Pharmaceuticals; the signing of energy MoUs with Elsewedy and AMEA Power; the rollout of 20 megawatts grid-integrated battery energy storage system worth US$20 million from the Rockefeller Foundation with support from the Global Energy Alliance for People and Planet and the multi-million dollar Compact with the Millennium Challenge Corporation.

“While this focus on development diplomacy will continue in the coming fiscal year, we will also focus on economic diplomacy, where our diplomats will also promote investments in Malawi, secure markets for the trade of Malawian goods, and promote Malawi’s tourism.

“In this regard, there will be close collaboration between the Ministries of Foreign Affairs, Trade & Industry, and Tourism. I am pleased to inform you that following our efforts to restore the confidence of the international community in our commitment to credible governance, some development partners like the European Union are exploring the possibility of resuming budget support, which was halted in 2013.

“Also, as part of our pursuit of economic diplomacy, my Administration secured a cooperation agreement with the Kingdom of Morocco, which has since opened its foreign mission in Malawi and donated 10,000MT of fertilizer. Similarly, we received a donation of 20,000MT of NPK fertilizer from Uralchem, a Russian company through World Food Programme.”

Further, Chakwera said in the year under review, Government also leveraged on his chairmanship of SADC, which ended in August 2022, saying his role as chair of LDCs, which ends next month, is to promote investment and trade.

Natural Resources and Climate Change

Another arena which Chakwera’s administration is pursuing for revenue and forex generation is carbon trading, under the Ministry of Natural Resources & Climate Change, saying while at the COP 27 last November, he signed a carbon trading compact with the Government of Switzerland for transaction of internationally-transferable mitigation outcomes (ITMOs), under Article 6 of the Paris Agreement, and developing national framework and guidelines for its implementation.

“Going forward, we will continue our ongoing engagement with carbon markets through the national reducing emissions from deforestation and degradation (REDD+), as well as through the new partnership my Administration has established with the African Carbon Markets Initiative (ACMI) in order to scale up our carbon credit production.

“So our plan is to expand these projects from the current average of 600,000 tonnes of carbon credits each year towards our national target of generating 5 million carbon credits, which will mobilize up to US$100 million and support more than 250,000 jobs.

“This would only be the beginning, because the value of Malawi’s carbon credits is estimated at close to 20 million metric tons of carbon per annum valued at US$628 million per annum.

“But one of the implications of this is that as a nation, we have to get serious about preserving our forests. In 2022, we had to recruit 300 forest guards and 33 forestry officers who were deployed in 88 forest reserves and 21 forest plantations.

“Through their efforts, we have managed 5,772.4 hectares of natural regeneration, contributing to an increase in our forest cover in areas such as Kaning’ina, Dzalanyama, Mulanje, Zomba-Malosa, Pelekezi, Ntchisi, Thuma, Thambani, Mua-Livulezi, and Philirongwe forest reserves, which are vital water catchments, tourist attractions, and biodiversity hotspots.

“Madam Speaker, it may also be of interest to you and the Members of this House to know that in an effort to make our conservation efforts sustainable, my Administration has established the National Climate Change Fund, with K500 million in seed money for its operationalization.

“But in terms of forest conservation, more will be done, and we have a whole set of measures for that purpose.”