Malawi’s anticipated entry into the Guided Trade Initiative of the African Continental Free Trade Area (AfCFTA) will be delayed until April 2025.
The first consignment was initially expected to be moved between October and December 2024.
Private sector players have told Times Business that their shipments will not be ready for the market until next year.
The Ministry of Trade had previously announced that approximately 22 Malawian companies were engaged to take advantage of trading opportunities under the Guided Trade Initiative.
Six companies, including Press Cane Limited, H Adams Wholesalers, Mzuzu Coffee, Temwanani Agro-Foods, Agricultural Development and Marketing Corporation and DEK Engineering and Electrical Contractor Private Limited, were prioritised due to their expressed interest in participating in the activity.
In an interview, H Adams General Manager Naim Gulan Molvi noted that their agricultural exports would be ready for the market by July or August next year.
“We estimate handling close to 500 metric tonnes per month initially, which could generate approximately $750,000 monthly,” Molvi said.
“Most farming in Malawi is subsistence, lacking proper warehousing and post-harvest knowledge. This affects Aflatoxin levels and other quality standards demanded by importing countries,” he said.
DEK Engineering and Electrical Contractor Chief Executive Officer (CEO) Daniel Ekali Kwizombe anticipates their first export of LED energy saver bulbs by June 2025, following completion of documentation processes, notably Buy Malawi initiative registration.
“We already have interested markets in Zambia, Ghana and Rwanda, ready to receive our initial export of around 50,000 LED bulbs, valued at about $500, 000,” Kwizombe said.
Press Cane Limited is also preparing to enter the market, with plans to export portable ethanol and carbon dioxide (Co2).
CEO Bryson Nkomawanthu mentioned readiness to ship portable ethanol by April or May next year while Co2 exports could commence by August, pending factory construction completion.
“We aim to export about 3 million litres of ethanol annually, with an estimated value of $3 million,” Nkomawanthu said.
He emphasised the need for comprehensive support to facilitate private sector participation in the market and ongoing awareness.
“Portable ethanol faces significant tariff barriers, including taxes and high landing costs, challenges we hope to address through AfCFTA market participation,” Nkomawanthu said.
On his part, Trade Minister Sosten Gwengwe said amid minor challenges, including logistics, the government was working to smoothen private sector participation.
“There are some hand-holding that the Afrexim Bank is giving. For example, issues to do with in-transit bonds because of the toll gates and toll fees, moving from one country to another, which sometimes act as non-tariff barriers. But there are some arrangements that are being put in place to smooth passage of goods and services amongst the countries in Africa,” Gwengwe said.
Malawi signed the AfCFTA agreement in March 2018 and ratified it in January 2021, joining a continental free trade area designed to improve intra-African trade by eliminating tariffs and non-tariff barriers. The AfCFTA comprises 55 African member countries, boasting a population of 1.3 billion and a combined gross domestic product of $3.4 trillion.
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