Malawi’s 2012 total exports to the rest of the world slumped by 16 percent to $1.27 billion from $1.53 billion in 2011 indicates the latest United Nations Conference on Trade and Development (Unctad) data.
However, the Unctad data indicates that Malawi’s imports rose by 12 percent from $2.6 billion in 2011 to $2.95 billion in 2012, consequently widening the country’s trade deficit by 53 percent to $1.7 billion.
Commenting on the poor performance, Ministry of Industry and Trade spokesperson Wiskes Nkombezi, in a telephone interview on Tuesday said, a country’s exports are based on its productivity.
“Last year, we had problems in terms of productivity due to shortages of fuel and foreign exchange. We also had problems in electricity, and all these hampered the country’s productivity and exports,” said Nkombezi.
He, however, added that the implementation of the National Export Strategy (NES) which the country launched last year is going on smoothly.
Nkombezi expressed optimism that this year’s trade performance would improve arguing indications are there that Malawi’s exports will rise.
However, the International Monetary Fund (IMF) in the Malawi’s country report indicated that the 2013 trade deficit would narrow to $490.1 million from $658.2 in 2012.
The report, published in May this year, indicated that in 2013 Malawi will import about $2 billion worth of goods and export $1.5 billion which is $490.1 million short of imports by the end of this year.
Last year, Malawi suffered a historic low proceeds from tobacco the country’s main foreign exchange earner, whose performance has improved this year with recent reports indicating $355 million sales.
Experts have called on Malawi to diversify away from reliance on agricultural to avoid persistent poor trade performance.
Last year, Malawi developed the NES whose goal is to match long-term export and import trends. The strategy targets to raise exports as a share of imports from 51.5 per cent in 2010 to 75.7 percent in 2017 and 93.4 per cent in 2022.
The NES is aimed at providing a clearly prioritised road map for building Malawi’s productive base to generate sufficient exports to match the upward pressure on Malawi’s imports. The NES further aims to maximise the direct contribution of exports to economic and social development.
The NES also aims to do achieve the an increase in exports through the development of the private sector in a manner that is balanced with the economic empowerment of the rural and urban poor, smallholder farmers, youths and women.
The export strategy three export-oriented clusters for diversification: oil seeds products, sugar cane and manufacturers.
It includes support plans to stakeholder efforts in other major existing clusters: tobacco, mining, tea, tourism and services.