EDF, afreximbank move to boost production
The Export Development Fund (EDF) in partnership with the African Export-Import Bank (Afreximbank) and Arise Integrated Industrial Platforms (Arise IIP) have advanced in the establishment of the export trading company (ETC) in Malawi.
According to EDF, the move is aimed at boosting the country’s productive capacity to improve Malawi’s performance in regional and global trade.
In a statement, EDF said ETC will be key to bringing market intelligence to producers so that production of goods is driven by market requirements.
Reads the statement in part: “In addition, it will also handle export logistics and assist in aggregating products to achieve economies of scale, especially for smallholder farmers and small and medium enterprises [SMEs] who may not have the capacity to participate in export trade.”
Some functions of an ETC, according to the statement, include provision of export market access, expertise, risk mitigation, cost efficiency, simplified processes and assisting in export financing.
Afreximbank is facilitating the emergence and expansion of an African model of export trading companies to facilitate intra-African trade under the African Continental Free Trade Area (AfCFTA), a market with 1.3 billion people, comprising 55 countries and a gross domestic product of $3.4 trillion, according to the statement.
In Malawi, Afreximbank is also supporting the establishment of Magwero Industrial Park in Lilongwe where the ETC will play a role in facilitating exports.
Afreximbank director for trade facilitation and investment promotion Gainmore Zanamwe said in an interview on Thursday they have partnered Arise IIP on this agenda and are working with EDF to facilitate the setting up of ETCs in Malawi.
“The ETC will help Malawi boost the productive capacity of various products and ensure that the goods processed here in Malawi are exported,” he said.
Currently, Malawi does not have lacks a well-organised and large-scale export trading company to provide market information and assist exporters, SMEs and traders to effectively participate in international trade.
EDF managing director Fredrick Chanza said their role is to be an enabler for local firms to tap into the various market opportunities present in the region and beyond.
He said for that to happen, there is need to address some of the limitations that hinder the country from tapping into these opportunities.
Said Chanza: “We are talking about market intelligence challenges, logistical challenges, operations based on limited scale and lack of upstream financial and non-financial support services.
“One way of dealing with these issues is through the ETC, which will help in facilitating international trade since they provide support services to firms that specialise in exporting.”
Arise Integrated Industrial Platforms, a technical partner in this project, has done a market study and value chain analysis of some of the crops that are viable in setting up the ETC in the country.
