Malawi bans foreigners to trade in rural areas: Chinese affected with new law

Malawi has new business licensing law which would prevent foreign traders from working in rural areas as of July 1.

A Chinese merchant talks to customers in his shop in Salima, a dusty town of 40,000 people near the shores of Lake Malawi, in this picture taken July 31, 2012. REUTERS/Ed Cropley

A Chinese merchant talks to customers in his shop in Malawi. REUTERS/Ed Cropley

A Malawian hawker sells food outside a Chinese owned shop in Salima, a dusty town of 40,000 people near the shores of Lake Malawi, August 21, 2012. REUTERS/Ed Cropley

A Malawian hawker sells food outside a Chinese owned shop in Salima, a dusty town of 40,000 people near the shores of Lake Malawi,. REUTERS/Ed Cropley

The law says foreigners can only do retail business in designated urban areas, such as Blantyre, Zomba, and Lilongwe.

It adds that foreign traders need to obtain a license from the Chief Business Licensing Officer as well as the Investment Approval Committee.

“A person, who is not a citizen of Malawi, and intends to carry out business whose core activity is retail, shall operate in main cities and municipalities within the areas designated for that purpose,” Cliff Chiunda, the chief business licensing officer and a secretary of the Ministry of Industry and Trade, said.

Chinese traders who operate retail shops and restaurants in rural areas are expected to be most affected by the new law.

Malawian traders can’t fairly compete against Chinese retail traders whose goods are relatively cheap.

Others  in support of the Chinese traders argue that the foreigners offer lower prices than those offered by the local traders.

The new law is part of reforms introduced to Malawi’s economic legislation with the aim of implementing the country’s Growth and Development strategy II which focuses on empowering Malawi’s citizens.

A foreign trader has to pay $250,000 in fees to start a business in the light of the new law.

The licensing fees will help Malawi attract investors who can meaningfully contribute to the development of the country, Newton Kambala, the president of Malawi’s Confederation of Commerce Chambers, said.

 

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17 thoughts on “Malawi bans foreigners to trade in rural areas: Chinese affected with new law”

  1. nduna yakumwera says:

    I welcum the idea..akuyenereka kukhala town amenewa.azilipira msonkho komanso malipiro abwino kwa ma workerz

  2. chimwemwe says:

    for me,i think foreign got 250,000,they will not stay here ,now,this goverment are going to kill all of us,do u realy understand our realy probelm and know how to solve

  3. Tman says:

    So poor villagers do not deserve better prices. Do you really understand the pain we get here in the village to earn MK100 yogulira mchere, aspirin komanso macheso. Think twice. Most regulations stigmatize against grave diggers/villagers.

  4. Ngoma says:

    This is for all foreigners be it Nigerians, Burundis, Rwandese, Congolese, Chinese, Indians etc. Secondly, the US$250,000 is the minimum capital requirement. Licences fees in Malawi for foreigners are at K60,000.

  5. Ohhhooo says:

    Welcome to the death of Malawi. “The last nail in Malawis coffin” dont believe me i agree with Peter Nkosi. Its just going to pinch the pockets of poor malawians even more doesnt effect me one bit im an importer its good if the chinese move out rural areas but as a logical thinking human its going to effect our already last kicking horse of a thing we call “Economy”.

  6. ujeni says:

    Is government going to open Peoples in all rural areas every 1km? This will just worsen the problem. Our rural areas are already dead zones. Why not ban Nigerians in cities operating as owners of hawker stands? Did the government do a research to ask the people in rural areas or they just woke up and started acting like Nankhumwa.

  7. Tengupenya says:

    this is xenophobia, and it will hurt the poor Malawians out there! why can they not compete? why can they not negotiate deals. the rural economy cannot afford prices offered by local traders. how do the foreigners manage to offer lower prices? the market should be efficient, with the lowest possible prices for the consumer. if local traders cannot make it, let them fold. open competition is what will give the customer the best deal.

  8. Dingase says:

    This very good. We have seen even azungu as well who come here inform of doing charity or religious work but they end up in setting bussines rural areas like mimi buses or maize mills.

  9. Concerned says:

    About time now that all businesses should have EFD machines. The playing field should be parallel. MRA should be collecting tax from all the districts not one particular race. It’s about time that the tax base is widened to achieve the desired impact on development. As we all know that the Chinese in the rural area were tax payers and if we close them then less tax to government.
    LETS GET THESE BUSINESSES REGISTERED IN TAX BASE. EITHER SMALL OR BIG. AND GIVE EFD MACHINES.
    Imagine how many trucks are being loaded of goods going to rural area. All these items are for resale but our focus is just with in the cities Plse let’s build OUR MALAWI together.

  10. john says:

    Cliff Chiunda is one fine civil servant and planner.use him wisely and let him participate in development plans and economic policies.i salute him

  11. JB says:

    And limit which businesses these foreigners should do leave the small businesses to locals and collect taxes from these foreign businesses

  12. Peter Nkosi says:

    “Malawi has a new business licensing law …”

    What new law is that?
    When was the bill passed and when was it enacted?
    Where can we read what this law actually says?
    Maybe it is a regulation which can be introduced under existing legislation.

    The effect of this new law will just make things more expensive for the villagers. Vendors in the urban areas will buy from the Chinese paying the same as before, then jack up the price when they resell in the villages.

  13. Redeemed says:

    Should we call this another form of xenophobia?

  14. mohamed says:

    Let’s unite and work hard so that we can achieve the bussines and is true because there is a lot of burindians owned shops in the districts of malawi and send them the notice to move before facing the law.

  15. BBC says:

    How will a fee of $250 000 attract foreign investors?

  16. zakusimba says:

    Watch out they will marry and put business in their names.

Comments are closed.