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Michael Tome Business Reporter

NATIONAL trade development and promotion body, ZimTrade, says industry stands a chance to benefit from the Malawian market if it explores untapped supply areas for 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 rise from 2017’s $2,56 billion, signifying an increased appetite for foreign products.

ZimStats data shows that Zimbabwe’s total exports to Malawi amounted to US$6 million in 2018. Zimbabwe had a US$31 million trade deficit.

However, the trade promotion body believes Malawi is a low hanging fruit for Zimbabwean industry to take advantage of.

“A 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, fertilisers, 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 also an advantage.

“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, although Zimbabwean companies have been facing challenges in meeting demand.

“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 creates gaps for competing products from South Africa and other countries from the region and beyond,” ZimTrade said.

ZimTrade sees Malawi as an easy market to penetrate considering the relaxed regulatory environment which allows firms to quickly set up their enterprises.

However, South African firms’ growing presence presented strong competition.

“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 has less strict 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.