On the Fast Lane of Malawi: Where are we on $1billion FDI from MIF?

This week British Prime Minister David Cameron is filling a plane with captains of business in his country to South East Asia where they are expected to strike trade deals worth £750 million. Wow. This is eye-watering.

President Mutharika, vice president Saulos Chilima and top govrnment officials at the investment forum

President Mutharika, vice president Saulos Chilima and top govrnment officials at the investment forum

The British PM is heading not to India and China but to the furthest corner of South East Asia like Indonesia, Malaysia, Vietnam, and Singapore. The UK we are told has a target of doubling its exports to £1 trillion by 2020 and sees the booming economies in the east as plum markets for British goods and services as well as sources of direct investment to the UK.

In this trip, Cameron is breaking ranks with his predecessors with regards to Vietnam. He will be the first British prime minister to visit that country which has the fastest growing middle class in South East Asia.

As for Indonesia, there are likely to be some diplomatic tensions, of course. The world’s biggest Muslim country has seen between 200 and 500 of its nationals get enlisted into the so-called Islamic State (IS) in Syria and Iraq. The picture is not different from Malaysia where some of its young men have been seen as engaging in weapon training in IS-held territory. But Cameron is focussing on the brighter side of things.

The background is that Britain does more trade with Belgium than it does with Indonesia, Malaysia, Vietnam and Singapore.

But Cameron is visionary. By 2030, the largely untapped South East Asia market is expected to be the fourth largest single market in the world.

When I saw this, I remembered that close to two months ago the Malawi government hosted the Malawi Investment Forum (MIF). The event was touted as the first-ever high level and high profile investors’ forum on the land to bring together potential investors from around the world. Our Chinese friends pumped in around K17 million for the function to take place.

A hyped Minister of Industry and Trade Joseph Mwanamvekha told the country at the end of the forum that within two weeks the business captains from around the world be sealing these trade and investment deals.

The deals promised to transform Malawi’s economic landscape. This is what Malawi badly needed not today but yesterday. But for organising the forum, I gave the government the benefit of doubt.

I have since not heard anything from the Minister since that time except all the negative publicity about government’s investment environment. One of them is that government, through the Green Belt Initiative (GBI) in Salima, has no confidence in its own security. The firm has hired a private security firm—G4S—to guard the Chikwawa Sugar Factory currently under construction.

The background to this is that 10 police men officers who used to guard the premises were arrested in connection with the theft of building materials and some welding machines from the company. If the state can’t ensure security to potential investors, who will?

While Cameron and his 31-member business leaders will go back to the UK smiling after striking the lucrative trades deals, I can on the other hand, guarantee that on efforts to secure trade deals from the recently held MIF, Malawi will continue to be dogged by issues like government’s police officers leading the onslaught not only on investors but also its citizens.

The Salima incident—where government’s law enforcers are in the forefront of perpetuating insecurity in the country—is the 1,001 that I have heard only this year about the country’s police officers being linked directly or indirectly to theft and robbery. All the while, we have a whole Ministry of Home Affairs and Internal Security whose mandate is to provide security to the citizens and organisations.

As I write this, I am reminded of the late Mr Issa Njauju, former corporate affairs manager at the Malawi corruption busting body—the Anti-Corruption Bureau (ACB)—who died in mysterious circumstances two weeks ago. His death is suspected to be connected with investigations that ACB is conducting to bring justice and fairness against enemies of law and order in the country.

All this is happening against the background of an economy that is heading south. Interest rates are prohibitive for investment at 40 per cent, prices of commodities are rising by the day, while the country is reeling under the weight of a food shortage for close to three million Malawians this year for the better part of the year.

Malawi remains one of the top 10 poorest countries in the world with over 39 percent of its population living below the poverty line of $1 a day not for nothing. It is not an appealing destination for investors compared to its neighbours, and that is why it has one of the lowest investment levels on the continent, measuring at only 8.1 percent of the Sub-Sahara GDP average. Government should seek to reverse not only the image but also the trend.

Given the hype that MIF was given and the trade investments deals that were touted, one would have expected government to keep informing its citizens about what has so far fallen into the trade basket as opposed to the total blackout on what is happening as if the MIF was not held at all.

Malawians expect the Minister of Industry and Trade to continually update them on what investments deals government is notching from such forum otherwise they will not be wrong to conclude that the MIF’s success was just politicking aimed at giving people the impression government is at work.

Political will is vital in ensuring that economic policy issues are conscientiously followed through. This seems to be a major deficit in this government. Otherwise the MIF was a good initiative and people are now waiting to hear results.

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Our leaders are good at fooling their subjects, i remember when Bingu became the AU chairman, he was using MW gvt resources for AU trips and one Cabinet Minister told the Mw nation that time that Malawi will benefit alot in 10years becoz the president chaired the African Union, the million question is, Did Mw benefit or we waisted the resources to fund the AU trips for nothing? Lastweek it was the same Mwanamveka who purpotedly said had a successful business discussions in UK, we are yet to see the benefits of the MIF, the UK trip by the Trade… Read more »
Emmanuel Nedi

Just before I looked at the name of the contributor, I read through the article. Then I was not surprised afterwards. Excellent and mature exposition from a seasoned writer Steven. I expect such standards from Nyasa Times. Then, you tick and the reader also ticks. Good work from Mr. Nhlane.

The main attraction for investers is skilled labour. One does not expect an investor to come in a country and start training people for the work to be done. There is also an issue of integrity and good employee/employer relationships. Malawi needs to adopt and advocate what Umodzi Party is advancing. Educate everyone, thereby investing in skilled labour and create industry by using the world existing financial systems. At the moment this is difficult for DPP for obvious historical reasons. Once others see that it is possible to make a profit in the country, they will then be attracted to… Read more »
Mika Kumbire
Stevie PP is not coming back! Wake up before you are thrown into the dustbin of history. China has shaken the world. The west never used to go out looking for trade in Vietnam and Korea. Trade used to come to London and washington. The world is changing and things have changed. Britain and USA have realised that they have been sleeping. And even the smallest countries are getting out of their hands. Please don’t plant the thought that Malawi cannot achieve anything for the sake of your children if you have any. Listen to Obama. The inability of Africa… Read more »

Malawi is poor because of us the people, look at some of the comments here attacking the writer of the article, so dull, people with poverty mentality

The content of this article is not surprising. Comparing between UK and Malawi is not just unreasonable but also obscene. You know that Steve. Hence the whole write up is abuse of the publicity that u have. In real sense Steve you are just one of those Malawians bitter for being in government for a very short with JB snd after the ouster, you are bent at destructive criticism against the government that ousted you via a ballot. Have you forgotten the time you tried to fight and defend your JB when you were at State House to the point… Read more »

Sapitwa – comment number 5 u r myopic and a hand clapper.


Mmmm! How can you compare Cameron with Peter.

The fact the UK is geared to invest in Asian countries does not suggest in any way that they are neglecting Malawi as you purport.People like you who hate your country by castigating it through your negative publicity are the most dangerous poison we have ever had since the doom of democracy in Malawi. Which country in the world has no corruption scandals, security concerns etc? Angola , South Africa, Mozambique just to name a few have the highest statics in all what could bar investors from investing in those countries and yet investors are booming every day.This is because… Read more »

I think issues of security, corruption and all vices are common to many countries. However, in the context of our nation there is little or no political will to sacrifice self interests against the general good. M

It boggles the mind that someone educated to your level can believe that donors base their decisions on what local writers say about their country. The three countries you have mentioned have two things which Malawi does not have: Coastline (therefore cheap transport costs) and abundant natural resources. This is the point that Nhlane and others are trying to put across – being landlocked and having fewer natural resources Malawi must do more to attract FDI. Good stories alone are nowhere near enough. Malawi must cut its enormous red tape and provide basic infrastructure that can attract some donors. You… Read more »

The investment forum was a nice excuse for the politicians to wine and dine at the taxpayers’ expense. These things in Malawi are usually little more than that.

Of course there were no real investments secured – the right honourable minister has not announced anything, as he had promised.

In a few months or a year or so there will be another ‘forum’, or the politicians will jet off to China or USA under the guise of securing ‘investments’ .

It’s all rubbish – yet we still allow ourselves to be fooled.

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