Malawi looks to neighbours to turn agriculture into regional trade engine

For decades, Malawi’s agricultural story has been dominated by a familiar paradox: a country where farming employs most people, yet one that struggles to turn what it grows into sustained economic growth.

Now, as African governments search for ways to feed a growing population while creating jobs and foreign exchange, Malawi is being urged to stop thinking of its agriculture in isolation and instead build regional value chains with its neighbours.

The idea, outlined at the Africa Food Systems Forum in Kigali this week, is deceptively simple: Malawi does not have to produce everything. It needs to identify what it can produce competitively, find neighbouring countries that can process or complement those products, and build markets that work in both directions.

Malawi’s industry, business, trade and tourism minister, Simon Itaye, offered one example involving Tanzania, saying Malawi could supply agricultural raw materials to Tanzania for processing into animal feed.

That feed could then return to Malawi to support poultry production, with Malawi ultimately exporting poultry back to Tanzania.

“We do believe that it is complementary,” Itaye told a panel at the forum. “It’s not a competition. It’s not one or the other. There’s no contradiction.”

The proposition comes as Malawi and Tanzania move to ease small-scale cross-border commerce through a Simplified Trade Regime covering an agreed list of goods and reduced customs barriers, with regional authorities working with both countries to operationalise the arrangement at the Kasumulu-Songwe border, according to the Southern African Development Community (SADC).

But panellists said infrastructure and trade agreements alone would not transform Malawi’s agriculture.

“The farmer is not the problem,” said Chris Isaac, chief investment officer at agricultural investment firm AgDevCo.

“The missing link is the surrounding ecosystem of the farmer.”

Isaac said food corridors should begin with a farmer who can produce profitably and end with a dependable market, requiring more than roads — including improved seed, fertiliser, mechanisation, agronomic advice, finance, storage and aggregation.

“Before asking how we move the food, we must ask, first, are we producing enough? Competitive and profitability,” he said.

Agriculture accounts for more than a quarter of Malawi’s gross domestic product and remains central to employment, food security and export earnings, according to the US government’s trade promotion agency Trade.gov, with investment opportunities increasingly seen in agro-processing, irrigation, horticulture, livestock and fisheries alongside primary production.

Isaac said Africa was already seeing capital flow into major agricultural companies, with some medium-sized businesses beginning to attract commercial finance, but said there were not yet enough of them.

Building an agricultural company, he said, takes longer than the typical five- or six-year private equity cycle and “needs patient capital” — a gap AgDevCo has sought to address by raising more than $49 million for an initiative backing earlier-stage agricultural businesses.

Nigerian entrepreneur Oluyemi Iranloye, whose company Psaltry International grew from 17 farmers in rural Nigeria into a supplier of cassava products to multinational manufacturers, said African countries should replicate that model across borders, with each specialising in what it produces most efficiently.

“I have capability for, what I have advantage for. You are also giving me what you have capability for, what you have advantage for,” he said.

Itaye said governments needed to harmonise policies, match exporters with markets and streamline border procedures, adding that current development programmes were already targeting agricultural commercialisation, value chains and regional connectivity, according to the UN Development Programme (UNDP).

“If we were to look at … our neighbours, Tanzania,” Itaye said, “our feeling is it is possible” to build complementary agricultural industries across the border.

Isaac said that if governments, regional institutions, banks and businesses got the fundamentals right, investment would not need to be chased.

“Investment will follow the opportunity,” he said.

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