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Finance minister Goodall Gondwe tells Jason Mitchell that Malawi needs to step up its marketing efforts to realise its full FDI potential and make the most of its abundant natural resources. 

Q: What are the greatest opportunities for foreign investors in Malawi?

A: There are tremendous opportunities in many business sectors. In electricity generation, we are already seeing many proposed investments. In five years’ time, the country could have a lot of independent power producers. Solar power is at the top of the list but there are also great opportunities in the hydroelectric sector and in wind power. We have been receiving many enquiries from foreign investors about the agriculture sector. Irrigation is ripe for large sums of investment. Coal mining is another industry with strong appeal to investors. We have approved quite a few licences to develop new mines.

Q: If so many new electricity projects are coming on stream, why does the country still suffer from regular power cuts?

A: Many of the projects are still awaiting power purchasing agreements from the Electricity Supply Commission of Malawi [Escom], the country’s state-owned electricity distribution company. It has presented foreign companies with a very thick volume of documents that need completing. It takes companies time to complete all of the paperwork.

Q: Isn’t bureaucracy a problem here? Can’t you push Escom to approve this kind of contract?

A: You try pushing them! It is not easy. The World Bank has suggested that we take a regulatory template from another country so that companies are able to complete all the paperwork within a couple of days. Here it takes a month or so. Senegal could provide such a template. But this is not an easy reform for us to make. We were a British colony and I think we have inherited a commitment to procedure from the British.

Q: Traditionally Malawi has been a big producer of tobacco but, as the price of tobacco has dropped internationally, it has become a less attractive crop for Malawian farmers. What other crops could be produced here and could be considered for foreign investment?

A: The country has extremely good soil and all sorts of tropical crops grow very well here. People have even suggested producing marijuana on a giant scale but that is a controversial idea. Certainly, foreign investors should look at investing in the production of peanuts, cashew nuts and soya beans. Something that Malawi has not done too well is marketing. The country’s first president, Hastings Banda, really emphasised the importance of the country marketing itself well and that is something that the current government must get more involved in; marketing the country to foreign investors, marketing all the possibilities in agriculture that exist, for example.

Q: What are the country’s mineral resources that are ripe for foreign investment?

A: Many geological surveys have taken place and they show the country is abundant in rare earth minerals and graphite, for example. British geologists also tell us that there is a considerable amount of oil under Lake Malawi. It should be possible to sink wells offshore and for it to be done in a way that does not spoil the lake.

This article is sourced from fDi Magazine
fDi Magazine

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