Transcript Investing in Malawi

Malawi Economic Outlook and
Opportunities
United Kingdom - Malawi Investment Forum
20th March 2013
Clement Kumbemba,CEO
Malawi Investment and Trade Centre (MITC)
[email protected]
www.malawi-invest.net
Introducing Malawi
“The warm heart of Africa!”
Second most peaceful country in Africa: Global Peace Index
2009
Stable democratic government
English-speaking and growing managerial work-force
Key figures
Population
15.4m
GDP
$5.6bn
Population growth
rate
2.8%
GNI per capita
$360
Rural population
80%
Exchange rate
$1 = MWK 383
(at 10.03.2013)
Urban population
20%
Macro-Economic Performance
• GDP Growth expected to rebound to 5.5% in 2013 from 1.9% in
2012 due to re-establishments of external credit lines, improved
availability of foreign currency and fuel and favourable weather
conditions.
• Headline inflation accelerated to 35.1% in January, 2013 largely due
to declining food stocks. Inflation figure in April, 2013 is projected to
slow down to 32.1% and will decline further to 18.0% by Dec.2013.
• Interest Rates remain high at 25% Reserve Bank Base Rate.
Commercial Bank lending and savings rates are averaging 36% and
10.5% respectively.
Cont. Macro-Economic Performance
• Exchange Rate of the local currency has continued to weaken
against the major currencies after the devaluation and is
currently averaging US$1 = MK390. It is expected to stabilize
by June, 2013 due to receipts from tobacco and agricultural
related exports.
• The Central Bank has revised upwards the export proceeds
retention rate from 60 to 80 percent. Move will significantly
encourage disclosure among exporters and will also boost
exports.
Strategic Direction for Malawi
Malawi’s Prospects are Bright
- Key development strategies (MGDSII, ERP, NES)
aimed at encouraging private sector led economic
growth
A new coherent
- Provides a coherent policy for investment in priority
national framework for
sectors and export clusters
investment
- Aims to increase ease of doing business and
transform Malawi’s economy into one of the fastest
growing in Sub-Saharan Africa.
Reforms in the critical
areas for private
sector development
- Reforms in immigration specifically target ease of
access of the country by foreigners
Fiscal Policy Measures
• Austerity measures to reduce unnecessary expenditure and focus on
key result areas
• Removal of subsidies on petrol and utilities
• Review of tax incentives structure
• Recent reforms in tax administration
Economic Reforms Under Ministry of Industry
and Trade
• Task Force to Improve the Ease of Doing Business in Malawi which has
timelines and targets and is working with all stakeholders involved in
business registration and facilitation
• Operationalization of the One Stop Investment and Export Centre.
Government through the Investment and Export Promotion Act has
empowered the Malawi Investment and Trade Centre (MITC) to be the
focal point for investment and trade matters.
Other Key Investment Enablers
• Political Stability and Peace
• Security of Life and Property Guaranteed
• No history of Civil War and Peaceful and Democratic Government
Changeovers
• Peaceful Co-Existence
• Free Repatriation of Profits, Dividends and Loyalties
Preferential Market Arrangements
o
Beneficiary to the COMESA and SADC Trade Protocols
o
Beneficiary to the EU’s Everything But Arms (EBA)
o
AGOA beneficiary
o
Beneficiary to the India, China, Canada, Japan Preferential
Markets
o
Duty free, quota free and preferential bilateral trade
arrangements with a number of countries, among them
Zimbabwe and South Africa
Security of Investment
o Constitution of Malawi guarantees
protection of foreign investors
o Malawi is a member of the Multilateral
Investment Guarantee Agency (MIGA)
o Malawi is a signatory to the international
centre for settlement of investment
disputes
o Member of the Africa Trade Insurance
Agency of COMESA
Malawi is open for business!
Contact us
Malawi Investment and Trade Centre (MITC)
P/ Bag 302
Capital City
Lilongwe 3.MALAWI
Tel: + 2651770800
Fax: +265 1771781
Email: [email protected]
www.malawi-invest.net