Standard Bank says China offers good export market
Standard Bank Malawi plc chief executive officer Phillip Madinga says China’s growing demand for non-traditional commodities is a “low hanging fruit” for Malawi to improve output and help narrow the country’s widening trade deficit.
He was speaking in Lilongwe on Tuesday during a trade networking forum organised by the Malawi Stock Exchange-listed bank for the small and medium enterprises sector who included the bank’s customers.
Madinga cited sugar, soya beans, tea and groundnuts as some of the non-traditional export commodities on high demand in China.
“China’s increasing demand for these commodities, which are easy to process, presents a great opportunity for investment in these value chains and the promotion of those companies in export,” he said.
While semi-processed tobacco is Malawi’s top export commodity to China, accounting for nearly $30 million in 2020, according to the International Trade Centre, available data shows strong demand for non-traditional commodities and that overall value of exports to China from Malawi is growing at an annualised rate of 13.2 percent.
“Our exports to China are dominated by tobacco, but how sustainable is this market and can we improve on our comparative advantage?” wondered Madinga.
Phyllis Msuku, finance manager for Projex Group, a Lilongwe-based engineering and steel firm said Standard Bank’s China proposition helped them to acquire vehicles and other steel assets for the rehabilitation of Chipata-Mchinji Railway line, among other large-scale projects.
“In addition, they are the ones offering us a facility we are using for importing raw materials for the production of corrugated iron sheets,” she said.
