With only two years remaining on President Bingu wa Mutharika's presidency bill, indicators are that his policy-vision to transform Malawi from a net importer to dominant exporter may not be fulfilled, raising concerns that an initiative once billed as the panacea to Malawi's perpetual balance of trade deficits could end up as a mere pipe-dream.
Mutharika pledged to transform Malawi from "a predominantly importing and consuming nation, to a predominantly producing and exporting nation" after taking over power in 2004, and changed the name of the Ministry of Trade and Industry to Industry and Trade to tally with the new policy goal.
While the president has made good his pledge to improve the country's food security situation, especially in maize production, there are few, to no signs, that the country is meeting its export goal.
When contacted to comment on progress so far, Principal Secretary for Industry and Trade, Newby Kumwembe, said he was on holiday and could not be able to give a complete picture on the same.
"I can only be able to comment when back in office, and when all my officers are there," Kumwembe said.
On the other hand, Industry and Trade Minister John Bande, who earlier on promised to come back to us after attending a chief's installation ceremony on Thursday, did not pick up his phone when several attempts to talk to him were made.
However, business captains have said that forex and fuel shortages, and lack of policy incentives to industry players,power outages pose the greatest threat to the country's export drive.
The country, which produces an estimated 1.69 billion kWh of electricity, is ranked 136th in electricity production in the world.
The country, according to the CIA Fact Book, needs 1.572 billion kWh annually.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI) president, Matthews Chikankheni, noted during the 2011 International Trade Fair that the business environment remained unfriendly to local industries.
"There are a number of challenges, including power outages, which have a negative bearing on production output, a punitive tax regime, lack of incentives, shortage of foreign exchange, and the continued management of the Kwacha, which continues to impact negatively on attractiveness of local products abroad," Chikankheni said.
The manufacturing sector is already small at 11.0 percent of GDP, with agro-processing of such crops as tobacco, tea, and sugar making the bulk of activities.
All these factors threaten to dampen Malawi's 2009 achievement as the second-best nation in industry production growth rates in the global economy. The country registered a 17.3 percent growth rate in 2009, second only to oil-rich Qatar, which registered a 27.1 percent industrial production growth rate.
Qatar maintained the position of the world's fastest growing economy in 2010, while Malawi tumbled.
Unlike Malawi, Qatar- whose agriculture products include fruits, vegetables, poultry, dairy products, beef and fish- has booming industries in liquefied natural gas, crude oil production and refining, ammonia, fertilizers, petrochemicals, steel reinforcing bars, cement, and commercial ship repair.
According to the Central Intelligence Agency's Fact Book, Qatari authorities managed to shrug off the global economic crisis by directly investing in the banking sector, a development that, strengthened by global oil price increases, led to a rebound in its GDP.
The country has for the past 10 years focused its economic policy on developing non-associated natural gas reserves and increasing private and foreign investment in non-energy sectors. However, oil and gas still contribute 50 percent of GDP, 85 percent of export earnings, and 70 percent of government revenues.
As Qatar continues to consolidate its economic position, the same cannot be said of Malawi, which lost the rail track of its Extended Credit Facility with the International Monetary Fund during the first quarter of 2011.
Malawi Economic Justice Network's executive director, Dalitso Kubalasa, said that immediate action was needed to address macro-economic imbalances which, he claims, "have derailed the economy from its successful growth trajectory of 2004 to 2009". Kubalasa said persistent fuel shortages, commodity price rises, and stagnant incomes spell doom for a country once touted for its successful economic performance.
"In many instances in other developed parts of the world, when such matters of pressing national concern of (sic) the magnitude of the fuel and forex crisis arise, one would expect specialist commissions or special committees to be immediately set up, to interrogate the root causes of the problems and find solutions for redress,' Kubalasa argues.
And, in its Ease of Doing Business analysis, the International Finance Corporation notes that, unless the country improved on electricity supply, its export drive would remain a pipedream and affect attainment of the projected economic growth rates.
The country's Industry contributes 21.7 percent of GDP, with agriculture contributing 33.4 percent, and services 44 percent. But, against all the economic odds against Malawi, total exports still rose by 61 percent to 93.7 billion kwacha ($566 million) in the first half of 2011 as compared to 2010.
However, Malawi's export drive has been hampered by the tendency of exporting unprocessed and semi-processed goods, leading to the indirect exportation of employment opportunities abroad.
This can be noted from the National Statistical Office's (NSO) Bulletin survey of major exporting companies and associations for November. The survey lists Illovo Sugar Corporation, Tea and Coffee Association of Malawi and Tobacco Control Commission as the country's major exporters.
Illovo Sugar Corporation exported 107, 000 metric tonnes of sugar in 2011, 7, 000 metric tonnes more than 2010 exports; Tea and Coffee
Association of Malawi registered 2,000 metric tonnes of coffee, against the 30, 000 projected capacity, while 39.3 million kilogrammes (down from 45 million kilogrammes) of tea were produced, respectively.
Of the three, however, it is only Illovo and Tea and Coffee
Association of Malawi that export finished and semi-finished goods.
For instance, of the country's top four foreign exchange earners, only sugar is exported in its processed form while cotton is either exported in the form of fabrics after semi-processing, with tobacco and uranium going in raw material form.
Even though NSO reported that total exports for the first half of 2011 had increase d by 93.7 percent (to 93,7 billion) compared with the previous year, its upsurge came on the back of unfinished goods namely tobacco (30 percent) and uranium (12 percent).
Currently, the country's major exports' regions include the Southern African Development Community (Sadc) region, European Union, Far East, neighbouring countries, North America, Common Market for Eastern and Southern Africa, United Kingdom, Germany, South Africa, and Zimbabwe.
According to the NSO Monthly Statistical Bulletin for November, tobacco, tea, sugar, coffee, apparel clothing, pulses, cotton, cotton fabrics, groundnuts, natural rubber and uranium remain the country's traditional exports. The bulk of these are exported either raw, or in semi-processed form.