Industrial output up 8.8%, tobacco major boost—NSO

Malawi’s industrial production, the volume of output generated by industrial sectors, increased by an average of 8.8 percent between 2021 and 2022, with tobacco being the major boost, National Statistical Office (NSO) data shows.

The data, contained in the Index of Industrial Production Brief, compares the manufacturing, energy and water supply indices for 2022 to that of 2021.

Despite the growth, the average industrial output of all sectors within the manufacturing sector declined with the exception of the manufacturing of tobacco, rubber and plastic products.

Reads the brief in part: “The manufacturing of tobacco products markedly contributed 65.3 percentage points to the annual growth rate of the volume of Malawi.

“Electricity generation also contributed positively to the annual growth rate by approximately four percentage points.”

During the review period, NSO data shows that the output of tobacco products increased by 72.9 percent while that of rubber and plastic grew by 7.8 percent.

Speaking in an interview on Tuesday, Malawi Confederation of Chambers of Commerce and Industry president Lekani Katandula observed that while the growth is encouraging, a string growth in the output of tobacco products is not sustainable.

He said if the country’s real manufacturing growth is positive and averaging north of eight percent per annum, which is higher than population annual growth rate, then that is encouraging.

“The only concern is that growth was strongest in tobacco which is unlikely to be sustainable given the global health anti-smoking lobby. One hopes we can soon see similarly strong growth in diverse industry sectors,” said Katandula.

Recently, Malawi signed a World Health Organisation Framework Convention on Tobacco Control (which could help the country reposition itself on tobacco regulation.

The signing of the treaty puts Malawi under scrutiny by the global framework for tobacco regulation, requiring the country to implement policies and measures to control tobacco use, protect public health and reduce the negative impacts of tobacco production and consumption.

However, tobacco remains a key cash crop in Malawi, contributing about 60 percent to foreign exchange earnings, 15 percent to the economy while the sector directly and indirectly employs millions of people.

Among all manufacturing industries, the manufacture of beverages registered the highest year-on-year producer price growth at 69.8 percent, followed by manufacture of chemicals and chemical products at 68.4 percent and 52.6 percent for the manufacture of food products, said NSO.