Malawi - Industry



Although a small and under-developed sector in Malawi, industry is nevertheless an important contributor to the country's GDP. But the burdens it struggles under are substantial. Hampered by the variability of the agricultural sector on which it is based, high transport costs, a small domestic market, and a poorly skilled work-force increasingly undermined by HIV/AIDS, Malawi's industries must also contend with a dependence on imported resources. This dependence largely robs the industrial sector of any benefit from successive depreciations of the kwacha and means Malawi's goods, despite low wage rates, often do not fare well against regional competitors.

The majority of Malawi's industrial activity (85 percent) comes from manufacturing, a sector that in 2000 generated around 14 percent of GDP. Malawian manufacturing is carried out by about 100 companies involved in agricultural processing, textiles, clothing, and footwear production. The concentration of this activity is another legacy of Hastings Banda's accumulation of wealth and power during the 30 years of his rule. The Press Corporation Limited (PCL), founded by Banda, is an example of how this legacy continues to distort Malawi's economic structure. A hugely diverse syndicate of brewing, clothing, oil, pharmaceutical, banking, and agricultural concerns with a total revenue equivalent to about 10 percent of GDP, PCL's monopolies in many industries further undermine competitiveness. Nationalized in 1997, the company is scheduled for dismantling and sale, although few of its assets are likely to attract the necessary interest.

Mining remains small-scale, and Malawi has no precious metals or oil, but ruby mining began in the mid-1990s, with Malawi the only source of rubies in Africa. Malawi also has deposits of bauxite, asbestos, graphite, and uranium. After the establishment in 1985 of a government mines department and a national mining agency to explore the feasibility of exploiting various minerals, bauxite and titanium reserves in the south were singled out for development. Although the supporting infrastructure is weak, some foreign investment has been attracted.

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User Contributions:

1
Kim
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Nov 26, 2012 @ 7:07 am
what are the order of events in which the industry happened??
2
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Jul 18, 2016 @ 7:07 am
Malawi needs managerial skills to be develop in business.

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