Tag: Malawi

Malawi Economy

Malawi Economy

ECONOMY: GENERAL INFORMATION

Malawi inherited from the colonial era an essentially commercial agriculture whose large plantations, started by white settlers, were on their property. pedological (almost 30% of the national surface is uncultivated and unproductive), Malawi was able, once it achieved independence in 1964, to somehow implement development programs only thanks to massive foreign aid and investment. The marked dependence on foreign capital inevitably conditioned the government’s economic policy; little changed the economic monopoly of the white minority, it was indeed widely benefited by a clearly liberal economic line, which in practice aimed to create the most suitable conditions to encourage foreign investment. The strong dependence of the economy on climatic conditions, as well as the lack of crop diversification (it exported sugar and coffee), the variability of their prices and the high transport costs (in addition to the lack of sea outlets) forced the country to resort to the aid of IMF and to radically restructure the economy through privatization and fiscal consolidation programs. In 1992 Malawi was hit by the very serious drought that hit all of southern Africa, which caused a sharp decline in agricultural production despite the adoption of fertilizers and hybrid seeds which had led to a significant increase in productivity; moreover, in the same year, due to constant violations of human rights, Malawi suffered the withdrawal of all non-humanitarian aid. Faced with these difficulties, the government adopted rigorous stabilization measures: supporting and encouraging the liberalization of the economy and the participation in the economic process of all those agents who in the past had been excluded from it; ensure a more important role for small landowners; privatize some state-owned enterprises; guarantee greater social equity and greater diversification of production. In the first decade of 2000, Malawi’s economy was still heavily dependent on international aid and foreign investment with inflation at 8.7% (2008), GDP growing by US $ 4,268 and GDP per capita among the lowest in the world of US $ 313 (2008). Visit clothesbliss.com for Malawi – the warm heart of Africa.

ECONOMY: AGRICULTURE, LIVESTOCK AND FISHING

A large part of the active population is employed in the agricultural sector (which contributes for almost 31% to the formation of the national income and which does not differ much from the situation in which it was found during the colonial period), mostly devoting themselves to pure activities. subsistence, from which generally rather modest productions are obtained: environmental conditioning is also sensitive, and in particular the state of instability of the territory, impoverished by unsuitable cultivation operations. For local needs, maize and other cereals (sorghum, rice) are grown mainly, then potatoes and cassava etc. The main plantation products, largely destined for export, are tobacco, cotton grown mainly in the south of the country, tea, sugar cane and peanuts. § Approx. one third of the national territory is covered by forests with precious woods, such as teak, mahogany and cedar; the timber is processed in various sawmills, such as in Blantyre and Zomba; forestry exploitation could be greatly enhanced. § As for livestock breeding, it is an activity of a certain consistency only in the high and medium-sized lands of the Center and North; goats and cattle prevail, as well as poultry. § Fishing is also discreetly important, on the contrary it registers a certain increase; it is mainly practiced in Lake Malawi and to a lesser extent in the other Chilwa and Malombe lakes, as well as in the Chire River. forestry exploitation could be greatly enhanced. § As for livestock breeding, it is an activity of a certain consistency only in the high and medium-sized lands of the Center and North; goats and cattle prevail, as well as poultry. § Fishing is also discreetly important, on the contrary it registers a certain increase; it is mainly practiced in Lake Malawi and to a lesser extent in the other Chilwa and Malombe lakes, as well as in the Chire River. forestry exploitation could be greatly enhanced. § As for livestock breeding, it is an activity of a certain consistency only in the high and medium lands of the Center and North; goats and cattle prevail, as well as poultry. § Fishing is also discreetly important, on the contrary it registers a certain increase; it is mainly practiced in Lake Malawi and to a lesser extent in the other Chilwa and Malombe lakes, as well as in the Chire River.

ECONOMY: INDUSTRY AND MINERAL RESOURCES

Despite the very serious underlying problems, the industry has nevertheless recorded encouraging developments: manufacturing activities, thanks to some incentives promoted by the government, in 2007 supplied over 17% of the national product. Blantyre is the largest industrial center in the country. However, the more traditional processes related to the transformation of agricultural products prevail, such as sugar refineries, oil mills, tobacco factories, breweries, etc. There are also cement factories, sawmills, as well as small companies that produce clothing items for the domestic market. § The development of the economy is strongly held back by the almost absolute lack of mineral resources, limited in practice to small quantities of coal, bauxite, uranium and precious stones (rubies and sapphires).

ECONOMY: TRADE AND COMMUNICATIONS

The trade balance is constantly passive. Mainly tobacco and tea, sugar, peanuts and rice are exported, while imports are mainly represented by fuels, means of transport, machinery, industrial products in general. § As it is without access to the sea, the problem of communication routes appears particularly serious for Malawi. The situation in the central and northern areas of the country is rather lacking, while the Chire valley and the region of the southern highlands, crossed by the railway that connects Salima, are better served.in Balaka. The road network developed for approx. 15,450 km in 2001, connecting with that of Zambia, Tanzania and Mozambique. Boat services serve the main centers of Lake Malawi and travel long stretches of the Chire River. Air services play a good role; the major airports are the international ones of Blantyre / Chileka, Lilongwe / kamuzu and Mzuzu.

Malawi Economy