eBusiness Weekly
Michael Tome
HARARE – National trade development and promotion body, ZimTrade says Zimbabwean industry stand a chance to benefit from Malawian market if they explore untapped supply areas for some goods that can be produced locally.
According to Trade Map, Malawi’s import bill for 2018 stood at US$2,71 billion a 5,9 percent surge from 2017’s US$2,56 billion signifying an increased appetite and need for foreign procured produce.
Zimstats data confirms that Zimbabwe’s total exports to Malawi amounted to US$6 million in 2018 while Zimbabwe had a US$31 million deficit between the two countries trade.
However the trade promotion body believes Malawi is a low hanging fruit for Zimbabwean industry to take advantage of.
“Survey conducted from 21 October to 1 November 2019 in Lilongwe and Blantyre which focused on the fast-moving consumer goods, furniture and household appliances, building and construction materials, agriculture inputs and implements sectors as well as related sectors revealed that there are vast opportunities that local companies can leverage on to grow national exports to Malawi,” ZimTrade said in a Malawi market survey findings report.
Malawi’s major imports in 2018 included mineral fuels and oils, plant machinery and mechanical appliances, print materials and printed books, vehicles, electrical machinery and equipment, fertilizers, pharmaceutical products and plastics.
Other major imports included textiles and clothing, iron and steel, soap and cleaning agents, cements and plastering materials, cereals, animal and vegetable oils, tobacco and manufactured tobacco substitutes, rubber, and furniture.
ZimTrade believes Zimbabwe’s proximity to Malawi is an advantage on its own hence deserves a share from the US$2,71billion import bill.
“Given Zimbabwe’s proximity to Malawi, there is room to grow the current export figure and increase the country’s share of Malawi’s total import bill which stood at US$2,71 billion in 2018 according to Trade Map, up from US$2,56 billion in 2017 and US$2,22 billion in 2016
“Local businesses can take advantage of Malawi’s growing economy and supply sectors, which include FMCG, construction, furniture, household products and agriculture inputs and implements,” said ZimTrade.
Local products have a competitive advantage compared to some regional countries, given their quality, but Zimbabwean companies have been blamed for undependable supply pattern as they default in most instances.
“Zimbabwean products are regarded as of high quality and positive feedback was received on some products including cordials and biscuits.
“Buyers in the market implored that Zimbabwean suppliers should be consistent in supplying products as sometimes products run out, leaving retailers without products on the shelves.
“This in turn create gaps for competing products from South Africa and other countries from the region and beyond.
ZimTrade sees Malawi as an easy market to penetrate considering relaxed regulatory environment which allows firms to setup their enterprises in a much faster way.
However, South African firms growing presence present a strong competitor ever since they established their massive footprint in the Central African country.
“Malawi’s retail sector, which is a viable route to market for local businesses to consider, is estimated at more than US$2 billion, with more than 70 percent of that amount traded in the informal sector which have less requirements than formal trade making it easy for Zimbabwean companies to enter that market.
“Although informal sector dominates the retail sector, there has been an increase of the formal sector in the past few years. This has witnessed the rise of South African retail chains such as Shoprite, Game, SA franchises -Spar and Food lovers and KFC,” ZimTrade said.
Other major retail giants that have been making strides in Malawi include the Tanzanian manufacturing giant-Azam Industries as we all as Zambia’s Trade Kings.
