RESTRICTED  
  
WT/TPR/G/335  
23 March 2016  
(16-1652)  Page: 1/16  
Trade Policy Review Body  Original: English  
 
TRADE POLICY REVIEW 
REPORT BY 
MALAWI 
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Organization), the policy statement by Malawi 
is attached. 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the first 
session of the meeting of the Trad e Policy Review Body on MALAWI. WT/TPR/G/335 • Malawi 
 
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  Contents 
1   INTROD UCTION  .......................................................................................................... 3  
2   ECONOMIC ENVIRO NMENT (2010 – 2015) .................................................................. 3  
2.1   Gove rnance ..............................................................................................................  3 
2.2   Macroeconomic Developments ..................................................................................... 4  
2.3   Sectoral Performance ................................................................................................. 5  
2.3.1   Agriculture ............................................................................................................. 5  
2.3.2   Manuf acturi ng ........................................................................................................ 6 
2.3.3   Fo restry  .............................................................................................................. .. 7 
2.3.4   Mining ................................................................................................................... 7  
2.3.5   Services .............................................................................................................. .. 8 
3   TRADE DEVELOPM ENTS AND POLICY......................................................................... 11  
3.1   Trade Poli cy Objectives ............................................................................................. 11 
3.2   Trade Policy Formulatio n and Coordinati on Fram ework ................................................... 12 
3.3   Competition and Fair Trading ..................................................................................... 12 
3.4   Domestic Laws and Re gulations Gove rning Trade .......................................................... 12 
3.5   Bilateral Tr ade Agreements ........................................................................................ 13 
3.6   Regional Tr ade Arrangements..................................................................................... 13 
3.6.1   COMESA ............................................................................................................... 13 
3.6.2   SADC .................................................................................................................. . 13 
3.6.3   SADC-EAC-COMESA Tripartite Framework ................................................................. 13 
4   INVESTMENT MEASURES ........................................................................................... 14  
5   MALAWI AND THE MULTIL ATERAL TRADING SYSTEM ............................................... 14  
5.1   Implementation of WTO Agr eements ........................................................................... 14 
5.2   Implications of Other Tr ading Arrangements  on Malawi .................................................. 15 
5.2.1   Economic Partnership Agreements ............................................................................ 15 
5.2.2   Generalized System of Preferences ........................................................................... 15 
5.2.3   South-South Cooperation ........................................................................................ 15 
5.2.4   Aid for Trade .........................................................................................................  16 
6   CONC LUSION............................................................................................................. 16  
 
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1  INTRODUCTION 
1.1.  Malawi is situated in Southern Africa, surrounded by Mozambique in the south and southeast, 
Tanzania in the northeast and Zambia in the west.  Malawi comprises of an area of almost 118,500 
square kilometres out of which about 24,420 square kilometres is covered by Lake Malawi.  
According to a 2008 population census, currently th e country has a projected population of about 
16 million, with about 80% of the population residi ng in rural areas and the rest living in urban 
areas. Malawi’s economy is dependent on agri culture and exports of primary commodities.   
1.2.  The overriding goal of the Malawi government has been to provide a coherent and consistent 
economic framework that underpins the developmen tal objectives outlined in the Malawi Growth 
and Development Strategy II (MGDS II).  Malawi’s economic policies continue to be aimed at 
reducing poverty through sustainable economic growth and infrastructure development as 
espoused in the MGDS II. 
1.3.  To achieve sustainable levels of economic growth, Malawi requires strong macroeconomic 
management accompanied by both private and public investment in infrastructure and productive 
real sectors that improve productivity to address supply-side constraints identified in the areas of energy supply, and (cross-border) transport and trade facilitation. To undertake this, Malawi 
requires external support through grants and highly concessional financial assistance as well as 
prudentially crafted fiscal and monetary policies. 
1.4.  As a Member of the WTO the country part icipates in the Trade Policy Review Mechanism 
(TPRM) with a view to achieve greater transparen cy and understanding of its trade policies and 
practices and to ensure improved adherence to rules, disciplines and commitments made under 
the WTO Agreements. The third Trade Policy Review (TPR) for Malawi follows the second (2010) TPR. 
1.5.  Since the last Trade Policy Review in 2010, Malawi has continued to participate in the 
multilateral trading system through participation in: domestic trade police reforms to align to international trade best practices; the Southe rn African Development Community (SADC), the 
Common Market for Eastern and Southern Africa (COMESA), the African Caribbean and Pacific- 
European Union (ACP-EU) Economic Partnership Agreement (EPA) negotiations and the World Trade Organization (WTO) Doha Development Agenda (DDA). 
2  ECONOMIC ENVIRONMENT (2010 – 2015) 
2.1  Governance 
2.1.  Malawi continues to enjoy a stable and democratic government. Since the end of the one 
party regime in 1993, it has organized five peaceful presidential and parliamentary elections, one 
of which was a tripartite including local government election. Current president Prof. Arthur Peter 
Mutharika is in his first five-year term which st arted in 2014. The next elections are due in 2019. 
2.2.  In line with the country’s long-term de velopment strategy, Vision 2020, His Excellency, 
Professor Peter Mutharika in 2014 established the Public Service Reform Commission (PSRC) 
chaired by the Vice President, Dr  Saulos Chilima. The aim of the Public Service Reform Commission 
is to facilitate the creation of an effective and efficient Public Service that will spur economic 
growth through the nurturing of a market economy th at is friendly to foreig n direct investment and 
thereby facilitating long-term investments in various sectors including health, education and other 
social programmes. The Public Service Reform Commission recognizes that a transformed public service spurs economic growth and creates more jobs and businesses for Malawians. 
2.3.  In the Public Service Reforms Programme, His Excellency the President is calling Cabinet 
Ministers, the Public Service and all Malawians to support efforts to transform the country’s public 
service so that Vision 2020 of transforming Malawi to a middle-income country is met. 
2.4.  The PSRC has made several recommenda tions to various ministries, department and 
agencies (MDAs) on likely reform areas, including provision of uninterrupted services, right-sizing the civil service, prudent utilization of public resources, strengthening greenbelt initiative, WT/TPR/G/335 • Malawi 
 
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  provision of a conducive work environment, among others. Various Ministries and Departments 
have already been tasked to produce reform outcome areas and their Key Performance Indicators (KPIs) to be achieved over an initial 12-month period. The Ministers responsible will make public 
commitments on their expected achievements duri ng the designated period. At the end of the 
implementation period MDAs will be assessed, and their performance rating announced to the 
public, in order of level of performance. 
2.5.  In the same vein, in order to improve on Transparency International's Corruption Perception 
Index, the Government of Malawi has put in place a number of mechanisms and initiatives to help 
in the fight against corruption. The major one bein g the National Anti-Corruption Strategy which is 
a national document that consolidates multi-sectoral efforts to fight and prevent corruption in Malawi as one way of supporting the achievement of goals as outlined in the MGDS.  
2.6.  The main focus of the Strategy is the colle ctive action against corruption and is intended to 
achieve three broad objectives: to promote integrit y, transparency and impr ove service delivery in 
all sectors; to promote public involvement in the fight against corruption; and to intensify 
prevention of corruption and promotion of integrit y in all sectors. The Strategy has eight pillars 
that are implementing various anti-corruption initiatives and involves the public as the bedrock for supporting the country's anti-corruption efforts. These pillars are the Executive, the Judiciary, the 
Legislature, the civil society, the media, the pr ivate sector, traditional leaders and faith based 
organisations.  
2.7.  The Anti-Corruption Bureau (ACB) is the agen cy that is spearheading the implementation of 
the Strategy. Besides taking the lead in the implementation of the Strategy, the ACB continues to 
fulfil its mandate of preventing corruption; educ ating the public on the dangers of corruption; 
investigation of alleged or suspected corruption offences; and prosecution of alleged or suspected corruption offences. The Government set out its me dium-term objectives in the MGDS that were 
adopted in 2006. One of the underlying and fundamenta l objectives of the Strategy is to transform 
the country from a predominantly importing and consuming nation to a predominantly producing and exporting one.   
2.2  Macroeconomic Developments 
2.8.  Malawi has achieved positive growth during the period under review (2009-2015). GDP at 
market prices stood at about US$4.3 billion in  2014. Annual GDP growth averaged 5.9% between 
2009 and 2015, which included a marked slowdown  in 2012. The agriculture sector remains the 
mainstay of Malawi's economy in terms of cont ribution to employment and foreign exchange. 
Tobacco is the prime cash crop and most important cash commodity, although its importance has declined over the past years. Other important commodities include maize (the country's staple 
food), rice, tea, sugar, and cotton. In recent year s, Malawi has managed to attain self-sufficiency 
in food. However, regular adverse weather condit ions and unstable commodity prices have posed 
challenges to food security and the growth of the agriculture sector. 
2.9.  Real gross domestic product (GDP) grew by 1.9% in 2012, 5.2% in 2013, and an estimated 
4.7% in 2014.  Growth in 2014 was primarily driven  by growth of the agricultural, information and 
communication, and wholesale and retail trade sectors. Projections for 2015 indicate slowed growth to slightly below 5%.  In the 2014-15 season Malawi was hit by floods and drought which 
affected crop production. 
2.10.  Malawi Government is committed to pursuing the goals outlined in the Malawi Growth and 
Development Strategy (MGDS II). In line with this , the Government projects that real GDP growth 
rate for the next three years will average around 5.5% by 2018, while inflation is projected to 
reduce to an annual average of 9% by 2018 from  a projected 17.3% in 2016. The Government is 
in the process of reviewing the medium-term strategy, MGDS II for a period 2016-2020. MGDS III 
will continue its main objective of reducing poverty to be achieved through sustainable private-
sector driven economic growth and infrastructu re development. The Strategy's macro-economic 
objectives include reducing inflation to single-digit levels, increasing foreign exchange reserves to at least three months import cover, and improving the investment climate 
2.11.  The Government continues to run a fiscal deficit estimated at 5.9% in 2014-15 and is 
expected to remain as such in FY2015-16. The ec onomy continues to operate in a difficult fiscal WT/TPR/G/335 • Malawi 
 
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  environment characterized by a large budget deficit compounded by an accumulation of arrears 
and rising debt service costs. Expenditures are currently 29.9% of GDP and are expected to hover 
around the same rate for the next three years with  an upward marginal error of 2%. In order to 
ensure sound fiscal governance, the Government has put in place a number of measures aimed at 
tightening security and accountability surrounding the Government financial and accounting 
system, the IFMS. Furthermore the RBM in an effort to contain volatility in exchange rates embarked on initiatives aimed at tightening the monetary policy and increase exports through the 
Export Development Fund facility. 
2.12.  On the revenue side, revenues are currently at 23% of GDP and are expected to grow 
between 1% and 1.5% of GDP over the next three years. In order to achieve this, the Government 
of Malawi has committed to a broad-based tax reform with the aim of creating a simple, efficient, 
transparent and fair tax system. Such a system is expected to generate more revenues in an 
investor-friendly manner. It is also expected to streamline tax incentives and largely do away with tax exemptions due to their excessive distortionary effects. 
2.13.  However, the Government has embarked on  serious reform programmes to restore public 
and donor confidence. Advances have been made in fixing security gaps in public financial management (PFM) that were identified during “c ashgate.” The Electronic Fund Transfer (EFT) has 
been successfully used for payment of salaries of all civil servants and the risk assessment for 
using the EFT has been done. There is also an improvement in the submission of consolidated 
financial statements to the Auditor General for auditing. Electronic Fiscal Devices (EFDs) systems were also introduced to enhance VAT and tax collection. 
2.14.  During the period under review, Malawi cont inued to pursue prudent fiscal policies with the 
principal objective of reducing net domestic debt and creating a sustained increase in critical expenditures. This led to consolidated fiscal discipline evidenced by reduction of non-priority 
expenditures, directing more resources to pr iority areas and prudent budget execution. 
2.3  Sectoral Performance 2.3.1  Agriculture 
2.15.  The agricultural sector continues to be the major source of economic growth and remains 
the main sector in which the poor play a significant role.  The agricultural sector contributes 36% to 39% of GDP annually, of which the smallholder sector contributes 27%.  In addition, agriculture accounts for 80% of total employment and supplies more than 65% of the manufacturing sector’s 
raw material requirements.  It also accounts for ov er 90% of export earnings.  It is, therefore, 
expected that agriculture will continue to play a significant role in Malawi’s economy. Given its role as a key input for domestic manufacturing, this is likely to remain the case even as Malawi 
diversifies its structure of production into manufacturing. 
2.16.  There has been mixed agricultural performance in the period under review (2010 – 2015) 
with an average agricultural growth rate of 4.2% per annum. Meanwhile Government has 
reaffirmed its commitment to the agriculture sector. It is seen as one of the cornerstones of its 
development policy and, therefore, an estimated 18 % of the national budget is currently allocated 
to the agriculture sector. It is anticipated that the improved performance of the agriculture sector 
has great potential of driving national economy to greater heights. 
2.17.  The Agriculture Sector Wide Approach (ASWAp) programme was developed to address these 
concerns. The ASWAp is an overarching sectoral programme of prioritised investments geared at strengthening agricultural production and productivity. It also aims to promote agricultural 
diversification by increased production of food crops other than maize including: beans; 
groundnuts; soya beans; pigeon peas; horticultural crops; as well as small-scale livestock and fisheries related to the comparative advantages of each agro-ecological zone. The approach is 
comprehensive as it embodies strategies for addr essing market and institutional failures created 
by some of the reform programmes.  
2.18.  In addition to the ASWAp the Malawi Government is implementing various policies including: 
the Agricultural Policy; Food Security Policy; Nutrition Policy; Fertiliser Policy and Strategy; WT/TPR/G/335 • Malawi 
 
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  Contract Farming Strategy; Cotton Act, Policy and Strategy; and the Comprehensive Agricultural 
Marketing Development Systems Strategy.  
2.19.  The policy on Livestock Development in Malawi developed in 2006 emphasizes enhancing 
livestock production and productivity and disease control and is currently being implemented. The 
main objective is to increase availability of quality livestock and livestock products by promoting 
local production through enhancement of quality service delivery. 
2.20.  To further ensure sustainable food security in the country, the Malawi Government is 
implementing  the Greenbelt Initiative (aimed at  increasing production and productivity through 
irrigation intensification); Agriculture Development-Support Programme (ADP-SP) (which is aimed at improving effectiveness of investments aimed at food security and sustainable agricultural growth); Dairy Development Project; Irrigation, Rural Livelihoods and Agricultural Development 
Project (IRLADP); the Farm Income Diversification Project (FIDP) and the Farm Input Subsidy 
Programme (FISP).    
2.21.   The Government of Malawi has adopted and implemented many reforms within the 
agricultural sector. These reforms include: (a) liberalizing the markets for inputs (fertilizer and 
seeds) and output commodities;  (b) changing th e pricing and marketing policies letting market 
forces of supply and demand play freely;  (c) repe aling of the Special Crops Act, and thereby lifting 
restrictions for smallholder farmers to participate in growing high value export commodities such 
as tobacco;  (d) removal of subsidies on inputs and any concessions on credits;  (e) restructuring of input output and credit delivery system;  and (f) commercialisation of all state-owned 
parastatals in the agricultural sector.  All these reforms were holistically adopted and implemented 
to improve efficiency and competitiveness in the sector. 
2.22.  Despite the reforms, serious challenges re main in addressing all the constraints faced in 
agricultural production, marketing, and distribution and in the diversification into non-traditional 
agricultural exports. These challenges are linked to inadequate producer incentives, access to 
credit, and rural infrastructure, including feeder roads to allow private sector involvement in marketing inputs and outputs. In view of these, the Malawi Government has continuously been 
reviewing its policies, strategies and action plan s to overcome these challenges.  Such reviews 
have, among other things, led to the implementation of both short-term and long-term development projects and programmes aimed at enhancing growth in the sector. 
2.3.2  Manufacturing 
2.23.  Manufacturing is one of the strategic sectors,  as stipulated in the National Export Strategy, 
whose contribution to the country’s GDP at 9.5% is considered low to achieve desired economic growth rate and poverty reduction levels as compared to other countries in the COMESA Region. 
NES has identified for promotion priority sector s including: plastics and packaging; beverages; 
agro-processing; sugar and assembly industries. Government is also promoting local production of engineering materials, leather products, chemicals and fertilizers cement and farm implements, 
among others, in order to substitute for huge imports 
2.24.  The low contribution of manufacturing into Malawi’s GDP is due to the limited investments 
attracted in the sector over the past few decades. As the country aims at promoting private sector development and industrialization in order to beco me self-sufficient and reduce its reliance on 
donor support, it is imperative for Malawi to become a competitive destination for both domestic 
and foreign investment through, inter alia , the provision of a business friendly and enabling 
environment and strategic incentives for investments in the potential productive sectors.  
2.25.  To increase the sector’s contribution to 20% of the country’s GDP the Ministry is currently 
working on a number of interventions including establishment of Special Economic Zones (SEZs), a concept that allows a mix of activities, not only including manufacturing but also services.  Unlike 
the EPZ, SEZs produce for the domestic market as well as exports. SEZs offer a combination of 
world-class infrastructure and expedited customs and administrative procedures that overcome barriers to investment in the wider economy. SEZs are capable of contributing to export development, not only in terms of accelerating  export growth, but also in terms of export 
diversification. WT/TPR/G/335 • Malawi 
 
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  2.26.  Removal of VAT on raw materials is another intervention in the sector. One of the major 
challenges the manufacturing sector currently face s is payment of VAT on imported raw materials. 
The Ministry of Industry and Trade is currently  working with Ministry of Finance, Economic 
Planning and Development and the MRA to start the process of removing VAT on raw materials 
and it will be done in phases. The Ministry believes that this intervention will have a positive 
impact on both employment and contribution to GDP as manufacturing companies are expected to 
expand their operations. 
2.27.  Review and development of industrial incentives is another intervention aimed at promoting 
manufacturing sector. The Ministry is working on a comprehensive review of the existing investment and export incentives and proposed strategic incentives that could attract investment and develop exports in the country.  This will  include the review the existing investment, 
production and export incentive schemes (including  Industrial Rebate Scheme) to determine their 
effectiveness, administration and management by the Government of Malawi. Determine the 
benefits of the current incentives to the industries and companies that are currently using them. It 
will assess the weaknesses of the current tax incentives in boosting industrialisation sectoral 
development and export growth and development an d propose productive industrial sectors of the 
economy that require progressive incentives based on the outcome of the sector analysis above. 
2.28.  In addition, the Government recognises  that the small- and medium-enterprise (SME) 
sector is an important contributor to manufacturing. In this regard measures have been initiated to facilitate value addition by SMEs to Malawi’s products, in addition to making the SMEs competitive. This is also in view of the fact that the Malawi  economy is basically characterised by grass root 
SMEs that make up nearly 90% of the total number of enterprises, hence the need to increase 
their productivity. 
2.29.  However, the major constraints in the manufacturing sector include: the state of 
infrastructure; influx of cheap imports; high transportation costs; inadequate water and energy 
supply in rural areas; and industrial capacity in order to comply with international measures of standards. At present the Malawi Bureau of Standards has applied for accreditation under the 
Southern African Development Community Accreditation Service (SADCAS). 
2.3.3   Forestry 2.30.  Forest resources in Malawi cover an estimated 27% of the 9.4 million hectares of land. 
About 11% of this area is in National Parks and Wildlife Reserves, 10% is in Forest Reserves and 
7% is on customary land. Plantation forests constitu te about 1% of the total land area under forest 
cover. 
2.31.  Forestry remains the main source of en ergy. Biomass satisfies about 83.4% of household 
energy demand with electricity providing the rema ining 16.6%. This, therefore, leaves the country 
reliant on wood fuels. Thus, there is need to diversify sources of energy so as to reduce pressure on the need for firewood in future. 
2.32.  The country, however, continues to suffer from forest degradation largely because of 
poverty, population growth, agricultural expansion, infrastructure development and overdependence on wood fuel for energy. Over 93%  of the population depends on biomass energy 
for heating and lighting. It is estimated that forest resources are declining at a very alarming rate 
of 2.6% per annum mainly due to deforestation.  
2.33.  The Department of Forestry has embarked on various afforestation, forestry conservation 
and management programmes with all relevant stakeholders towards enhancing sustainable 
forestry sector development in the country, includ ing deployment of security in protected areas, 
intensifying annual afforestation campaigns, community-based forest management services. 
2.3.4  Mining 
2.34.  The MGDS identifies the mining sector as one of the sectors that could potentially generate 
economic growth for the country. Mines and Minerals Policy (2013) is a logical extension of the MGDS. The country has abundant mineral resources that can be sustainably exploited to contribute to the Government’s vision of transforming the country from a predominantly importing and WT/TPR/G/335 • Malawi 
 
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  consuming nation into one that is predominantly producing and exporting. It is the Government’s 
conviction that if the country’s mineral resources ar e fully exploited, the contribution of mining will 
improve from the current 10% to 20% within the next 10 years.  
2.35.  The Government of Malawi recognizes that the minerals sector has a significant potential to 
contribute towards the rapid economic growth and development of the country. Currently, the 
sector is still very small despite its favourable geology and known mineral potential. Through the Mines and Minerals Policy, the Government seeks to stimulate and guide private mining 
investment by administering, regulating and facilitating the growth of the sector through a 
well-organized and efficient institutional framework thereby enhancing the country’s attractiveness as an investment destination. 
2.36.  Malawi also subscribes to and needs to actively participate in and respond to global and 
regional initiatives such as Kimberly Process, Multilateral Investment Guarantee Agency (MIGA) 
and Extractive Industries Transparency Initiative (EITI) that address mineral sector issues including practice, governance and other emerging realities. 
2.37.  In creating a conducive environment, the Government in 2015 undertook Airborne 
Geological Survey throughout the country to assist prospective investors to identify potential arears for investment. The Government is also reviewing the Mines and Minerals Act to enhance 
mineral rights. (Mining Cadastre). Furthermore, in 2016 the Government has planned geographical 
remapping to easily understand types of rocks across the country for infrastructure and agricultural development, among others. 
2.3.5  Services 
2.38.  Trade in services contributes to about 50.4% of GDP. Malawi has potential for growth in the 
services sector. Malawi has been participating in the services discussions at regional and multilateral level. At regional level, Malawi has further liberalized its services sectors in the areas 
of communication, financial, transport and tourism in order to attract FDI in the crucial sectors of 
the economy. A national strategy for services is dr iven by domestic policy priorities and grounded 
in the services export activity already taking pl ace in order to support and strengthen Malawian 
service exporters. 
2.3.5.1  Financial services 2.39.  There have been significant developments in the banking (depository corporations) sector 
during the period under review.  Overall, the financial performance of the commercial banks has 
been satisfactory with all banks adequately capita lized and liquid. The commercial banks, however, 
are still dominated by the two largest banks i.e.  National Bank of Malawi and Standards Bank. 
Over the years, direct government control and ownership in the financial system has significantly 
been reduced through privatisation and public  offer with Malawi Savings Bank sold and 
government stakes in Inde Bank on offer again. 
2.40.  The nonbank financial sector comprises insurance companies, pension funds, capital 
markets, microfinance institutions and discount houses. Pensions and microfinance are now 
prudentially regulated by the Reserve Bank of Ma lawi through the Pensions Act and Microfinance 
Act. 
2.41.  In a bid to strengthen the financial sector in general, a review of various legal frameworks 
has been undertaken and a number Acts were enacted by Parliament, including the Financial 
Services Authority Act; the Securities Act; the Microfinance Act; and the Financial Cooperative Societies Act. The Banking Act, among others. 
2.3.5.2  Tourism 
2.42.  As highlighted in the Malawi Growth and Development Strategy (MGDS), tourism in Malawi 
has the potential for growth to provide income, foreign exchange earnings and employment. To 
c o n t r i b u t e  t o  e c o n o m i c  d e v e l o p m e n t ,  t h e  G o v e r n m e n t  i s  a i m i n g  a t  e s t a b l i s h i n g  M a l a w i  a s  a  
principal and leading eco-tourism destination in Africa and also to increase domestic tourism.    WT/TPR/G/335 • Malawi 
 
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  2.43.  The sector is however faced with a number of challenges including: inadequate 
infrastructure; inadequate investment in the sector; inadequate financial resources for destination marketing; inadequate human resources; lack of direct flights from the major tourist source markets; and lack of good quality delivery in some of the hospitality units.  
2.44.  In an effort to address the challenges, th e Government developed a Strategic Plan that will 
guide the development of the sector in the next  five years (2016-2020). Implementation of the 
National Tourism Policy which provides an overall guide on how the sector should be developed 
including: improving transportation links to tourism destinations; increasing attractiveness of 
national parks for tourism and eco-tourism; and improving tourism marketing regionally and internationally. It recognizes that tourism is a cross-cutting sector touching on areas of transport, health and safety, environment, and telecommuni cation among others. The policy, therefore, 
recognizes this multilayer network of stakehol ders and outlines the areas in which they can 
support the sustainable development and promotion of tourism. 
2.45.  The Malawi Tourism Strategy 2020 is currently used as a source of inspiration for a common 
vision and includes goals that can be achieved through actions implemented with cooperation 
between the Government of Malawi, members of the tourism industry, non-profit organizations, donor agencies, and the people of Malawi.  
2.46.  The Malawi Tourism Strategy 2020 suggests directions and actions to be taken by 
responsible stakeholders and how success will be measured in the following three strategic areas:   
a. improving the enabling environment by reducing barriers for new and operating 
businesses, addressing infrastructure challenges, strengthening public-private 
sector dialogue, and incentivizing investment; 
b. strengthening Malawi’s tourism offer by building a network of regional tourism 
committees to address gaps in tourism products and services; 
c. grow international tourism demand for Malawi through the establishment of a 
public-private partnership destination marketing organization that engages in best practices to inspire visitation by high-value travellers.  
2.47.  The Ministry of Information, Tourism and Civic Education, through the Department of 
Tourism has started implementing the Malawi Tourism Strategy 2020 and some suggestions from the plan have been actionable.  
2.3.5.3  Information communication technology (ICT)  
2.48.  The ICT sector was liberalized following the enactment of the Communications Act in 1998. 
This led to an increase in the number of operators as well as the separation of postal services from telecommunications. 
2.49.  The Malawi Communications Regulatory Authority (MACRA) was created to ensure that 
there is a level playing field in the sector, ensure the introduction of new services and licensing of new players. Currently there are two global syst em of mobile (GSM) operators (Airtel and TNM). 
There are also two fixed network providers (MTL and ACL). MTL, which was previously 
state-owned, is now in private hands with the Government retaining a 20% stake, whilst ACL is fully privately owned. There are more than four teen active internet service providers (ISPs) 
operators in Malawi. The sector is now connected to the fibre optic cable. New television stations 
have also been rolled out adding on the business in the sector. 
2.50.  Growth potential for this sector remains strong as internet service providers seek to 
increase their customer base and mobile phone operators have large potential to increase sales of 
airtime units, internet subscriptions as well as consolidating new services such as mobile banking.  
Mobile phone companies continue to undertake major investments into infrastructure to support these services. 
2.51.  The ICT sector is fully liberalized in th e sense that ISPs are allowed to own Very Small 
Aperture Terminals (VSATs) for their upstream connectivity and companies providing security WT/TPR/G/335 • Malawi 
 
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  services are allowed to install private radios and paging equipment. The Government has 
introduced convergence licence for ICT services to ensure that providers should be free to provide 
a wide range of ICT services. 
2.3.5.4  Transport 
2.52.  Malawi, being a landlocked country, depends largely on overland movement of exports and 
imports. Its transport network and its connections to neighbouring countries are, therefore, of 
utmost economic importance. Transport costs account for 55-60% of the total cost of imports and 
exports in Malawi. 
2.53.  In view of this, the Government approved  a National Transport Policy which calls for the 
implementation of appropriate policies and regu latory measures aimed at improving operational 
efficiency and service quality on transport. This should improve competitiveness, productivity and 
profitability. For instance, management and financing of the road sector has been reformed with 
the creation of a National Roads Authority in  1997 taking over the responsibility (from the 
Government) for road construction, road rehabilitation and routine maintenance activities. A Road 
Fund Administration was also created to ensure the availability of funding. The main source of 
revenue is the fuel levy collected from petrol and diesel sales. 
2.54.  The liberalization of market entry to allow private sector companies to be involved in the 
provision and operation of transport services was done in 1994, which led to the 
de-monopolization of the state-owned companies. In  respect of this, Malawi Railways (1994) Ltd. 
was concessioned to Central and East African Railways Ltd in 1999. Air Malawi was privatised in 2013. 
2.55.  The Government has also embarked on the construction of the new multi-modal transport 
project, the Shire Zambezi Waterway Project and the World Inland Port at Nsanje to provide direct 
access to the sea, thereby reducing transport co st. Comprehensive feasibility studies are being 
conducted to ascertain its viability.  
2.56.  During the period under review construc tion of the railway line across Malawi into 
Mozambique (Nacala-Moatize) was completed and it is expected to increase the country’s railway 
cargo volumes. The Government also intends to rehabilitate the international airports, as well as 
improve marine transportation on Malawi waters. 
2.57.  Regarding the institutional framework, the Ministry of Transport and Public Infrastructure 
has been restructured and its role now is primarily to establish and facilitate policies as well as to 
regulate the transport sector and to carry out st rategic planning. The role of providing transport 
infrastructure is moving to the private sector.  
2.3.5.5  Energy 
2.58.  Malawi is endowed with several forms of energy resources, which include: biomass, coal, 
many perennial rivers for hydropower generation , high solar radiation, wind energy for water 
pumping and other minor applications, hot spring s for geothermal power generation, and uranium 
deposits.   
2.59.  In the period under review, the sector continued to monitor the base scenario of the Power 
Demand Forecast carried out in 2011.  According to the study, generation requirements were estimated to increase to 829 MW in 2020 from 40 8 MW in 2010. The growth rates captured by the 
study are generally higher in the second decade due to higher long-term economic growth rates. 
2.60.  In an effort to meet the projected demand in the country, the Government undertook 
hydropower plant feasibility studies at Chasombo and Chizuma in the 2012-13 financial year.  
Furthermore, the Government is undertaking hy dropower feasibility studies at Lower Fufu, 
Kholombidzo, Cimgonda and Mpatamanga sites.  The studies are underway and the preliminary results show that it is both feasible and economically viable to generate hydropower from these 
sites.  In addition to this, Kapichira Phase II was commissioned in December, 2013, adding 64MW 
to the national grid. Furthermore, plans are at an advanced stage to interconnect the power WT/TPR/G/335 • Malawi 
 
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  s y s t e m  i n  M a l a w i  t o  t h a t  o f  t h e  S o u t h e r n  A f r i c a n  P o w e r  P o o l  ( S A P P )  G r i d  t o  a l l o w  M a l a w i  t o  
participate in power trade in the region. 
2.61.  In a bid to restructure electricity tariffs in the country a study was commissioned to derive a 
tariff structure that reflects the cost of generation, transmission, distribution and other operation 
costs, in line with the Government’s policy of restructuring the electricity industry.  The tariffs that 
were determined are based on Long Run Margin al Cost (LRMC), ESCOM’s revenue requirements 
and national social objectives. 
2.62.  The implementation of the approved tariff shall be phased and spread over four years and 
will be subject to ESCOM demonstrated achievem ents in meeting the set performance targets.  
The first increase of 13.5% was effected on 4 April 2014, while 18.1%, 8.9% and 1.9% will be implemented in the second year, the third year an d the last year (2017) of implementation of the 
second base tariff, respectively.   
2.63.  In order to enhance rural electrificatio n, the Malawi Rural Electrification Programme 
(MAREP), having been started by ESCOM in 1980 and taken over by the Government as the 
implementing agency in 1995, has so far registered a lot of success.  The programme aims at 
increasing access of electricity to people in peri-urban and rural areas as part of the Government’s effort to reduce poverty, transform rural econom ies, improve productivity and improve the quality 
of social services. 
2.64.  The Department of Energy through MAREP is implementing Village Electrification Projects by 
u s i n g  S o l a - W i n d  ( H y b r i d )  S y s t e m s .   T h e  m a i n  t h r u s t  o f  t h i s  p r o j e c t  i s  t o  e x p e r i m e n t  o n  t h e  suitability of stand-alone renewable energy technologies for rural electrification in order to increase 
access to modern energy services by the rural communities. This is expected to transform the 
communities who are far from the national grid.  The Ministry through the Department of Energy Affairs has installed various renewable energy technologies such as solar/wind hybrid system for 
electricity generation and water pumping.  Biogas technology for cooking and construction has 
been completed.  The renewable energy technologies have been installed at the Department of Energy Affairs offices behind Natural Resources Co llege. The objective is to demonstrate how best 
and efficient the renewable energy technologies ca n be utilized.  The centre was funded by the 
UNDP 
2.65.  In an effort to increase the reliability and quality of electricity supply in the major load 
centres in Malawi, the Government, with support from World Bank, started implementing the 
Energy Sector Support Project. The project intend s to achieve this objective by strengthening the 
existing electricity network, performing generation and transmission feasibility studies for hydropower improvements, improving demand side  management and energy efficiency measures, 
and building capacity of the energy sub-sector through technical assistance. 
2.66.  The major reform of the sector is the splitting of ESCOM into two components of power 
generation and power distribution being operated by two different entities. The process is expected 
to be completed by 2017. The restructuring will im prove on power generation as investors will be 
encouraged to invest in power generation that will be supplied to a single power buyer (Single Market Operator) at harmonized rates for distribution to various consumers. 
3         TRADE DEVELOPMENTS AND POLICY 
3.1  Trade Policy Objectives 
3.1.  Malawi continues to maintain an open trade policy position, with relatively low tariffs and 
non-tariff barriers. The simple average applied MFN tariff in 2014-2015 was 12.7%, which is an 
improvement from 13.1% in 2009-2010. The goal of Malawi’s trade policy is to create a globally 
competitive export-oriented economy, generating higher and sustainable livelihoods through trade that recognises the role of micro-, small- an d medium-enterprises (MSMEs) and the vulnerable 
groups. 
3.2.  The policy aims to achieve this goal by driving structural transformation of the productive 
sector through supporting and managing domestic market structure and integration into regional and global value chains. WT/TPR/G/335 • Malawi 
 
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  3.3.  The policy advances the aspirations of the National Export Strategy (NES) formulated in 2013 
whose objective is to bridge the gap between imports and exports through structural transformation of three priority export clusters , namely; oil seeds products cluster, sugar cane 
products cluster and manufacturing (agro-processi ng, assembly, plastics and packaging) cluster. 
Consequently, it targets addressing binding constr aints, relating to access to markets, skills, 
finance, business development service, inputs etc., on the development of the productive sector. 
3.2  Trade Policy Formulation and Coordination Framework 
3.4.  The Ministry of Industry and Trade is  responsible for trade policy formulation and 
implementation.  This is done in consultation with the private sector, academia, civil society, media and various executive institutions and organs of government that administer other trade policy measures.  The Ministry has established the Tr ade, Industry, and Private Sector Development 
Sector Wide Approach (TIPSWAp) since 2013 as the main framework for implementing the NES 
and a consultative forum for discussing and coordinating trade policy issues. A technical working group on access to markets under the TIPSWAp is dedicated to this course. The Ministry also 
continues to maintain and co-chairs the Public-Private Dialogue (PPD) Forum and the National 
Working Group on Trade Policy (NWGTP) for consultations on more specific issues.  
3.5.  A draft Joint Sector Plan has been developed, with the objective of mainstreaming trade 
policy into sectoral policies and national budget cycles. It is to serve as a coordination and 
monitoring framework that would help avoid duplication and policy conflicts. 
3.3  Competition and Fair Trading 3.6.  The Malawi Government enacted the Competition and Fair Trading Act (CFTA) in 1998 to 
provide a legal framework for promoting competition and fair trading. This was in response to 
liberalization and deregulation of the economy which created a need for market-based regulation of economic activities.  
3.7.  Enforcement of the Act commenced in 2005 following the appointment of the first cohort of 
Board of Commissioners. Despite initial challenges in setting up the enforcement mechanism for the Act, the country now has a fully-fledged autonomous competition authority which was 
instituted in 2012. The Competition and Fair Trading Commission works as an independent market 
regulator which investigates and adjudicates over cases relating to anti-competitive and unfair trade practices. Its main function is to regulate, monitor, control and prevent acts and behaviour which have adverse effects on competition and fair trading in Malawi. 
3.8.  In this regard, the Commission has since its establishment resolved numerous cases relating 
to anti-competitive and unfair trading practices including assessment of mergers and acquisitions. This has contributed to a reduction in anti-compe titive and unfair business practices and therefore 
improved the functioning of markets and safeguarded consumer welfare.   
3.9.  The Commission also plays a pivotal role in sensitising the private sector to uphold a 
competition culture and educating consumers to exercise their rights in their dealings with the 
private sector. This is being done through interface meetings with various private sector groups, 
the judiciary and media houses with a view to deepening understanding of the stakeholders on 
their obligations and rights under the Competition and Fair Trading Act. The Commission has also embraced a media campaign to reach out to various stakeholders with messages on competition 
and fair trading. These initiatives are being implemented to foster voluntary compliance with the 
Act. 
3.4  Domestic Laws and Regulations Governing Trade 
3.10.  The Control of Goods Act is the main law that governs import and export trade in Malawi. 
This Act is currently being reviewed to reflect the objectives of the National Export Strategy and other national development strategies. 
3.11.  During the period under review, however,  the Companies (Amendment) Act, the Business 
Licensing Act, and the Business Names Registration Act have been enacted, and the Investment and Export Promotion Bill, the Export Processing  Zones Bill, and the Export Incentives Bill, WT/TPR/G/335 • Malawi 
 
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  Warehouse Receipt and Commodity Exchange Bill are awaiting Parliament approval. The Trade 
Remedies Bill is still under draft and yet to be finalized through public consultations before it can reach the legislature. 
3.5  Bilateral Trade Agreements 
3.12.  In the period under review, Malawi mainta ined bilateral trade agreements with Mozambique, 
South Africa and Zimbabwe, and a customs agreement with Botswana.   Malawi also has an agreement on trade, investment and technical cooperation with the People's Republic of China.  
3.6  Regional Trade Arrangements 
3.13.  Malawi continues to pursue regional integration within COMESA, SADC and the SADC-EAC-
COMESA Tripartite framework.  Malawi remains committed to these regional integration agreements, and continues to benefit from increased access to these regional markets.  During the 
period under review Malawi increased mark et access to SADC and COMESA members on a 
reciprocal basis subject to respective rules of origin. 
3.14.  There are several opportunities as to why Malawi participates in these regional groups.  
Apart from market access opportunities, cooperation in the area of transport, energy and 
infrastructure development provides a window for the mitigation of some of the major constraints faced by a landlocked least developed economy.  
3.6.1  COMESA  
3.15.  COMESA remains one of the key regional arrangements that Malawi continues to actively 
participate in. Malawi has completely liberalized its tariff under the COMESA FTA and is actively participating in the Customs Union preparatory processes.  Due to supply-side constraints, Malawi 
has not fully utilized the market access opportunities under the FTA. This is reflected in the fact 
that Malawi’s trade with COMESA has remained larg ely unchanged during the period under review.  
3.16.  Albeit, the regional market remains an important market for Malawi due to its landlocked 
status making the cost of transport a very crucial consideration. Malawi would be more competitive 
in regional markets provided the transport infrastructure improves.  
3.17.  Malawi benefits from regional integration programmes including Malawi Enterprise 
Productivity Enhancement (MEPE) Project and th e Technical Cooperation Facility (TCF) under the 
EU’s Regional Integration Support Programme (RISP3) funded with resources from the second phase of the 10th EDF. 
3.6.2  SADC 
3.18.  Malawi is committed to implementing her tariff reduction commitments under the SADC 
Protocol on Trade.  Under the Protocol, member States agreed to eliminate all tariffs on intra-SADC trade by the year 2012. Currently, Malawi has liberalized 100% of her intra-SADC 
trade, except with South Africa, which means th at Malawi is trading with other SADC member 
States using reduced or zero tariffs for almost half of the products under the liberalization programme.  In respect of trade with South Afri ca, Malawi has achieved 90% liberalization. The 
liberalization of the tariffs has been protracted because of the industry and revenue sensitivities 
that Malawi currently faces. 
3.19.  Malawi is also part of the SADC industrialization drive, which seeks to ensure that Member 
Countries export valued added products and benefit from liberalization under the SADC protocol on 
trade. 
3.6.3  SADC-EAC-COMESA Tripartite Framework 3.20.  The SADC-EAC-COMESA Tripartite FTA (TFTA)  negotiations were launched in Johannesburg, 
South Africa in June 2011. Malawi signed the TFTA Agreement on 10 June 2015 in Sharm el-Sheik 
in Egypt. Malawi supports the tripartite initiative as harmonization will reduce the need to comply and implement multiple regional obligations.   WT/TPR/G/335 • Malawi 
 
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  3.21.  Malawi’s interests in the TFTA include enlargement of regional markets, increased 
investment and expansion of trade, addressing multiple memberships, particularly SADC and COMESA, which is currently confusing the private sector players and other government implementing agencies,  the collective bargaining (“voice”) power of the Tripartite Area which has 
over 500 million people and GDP of around US$1.2 trillion, improved access to the sea through the 
Tripartite trade and transport facilitation programmes and, finally benefits from freer movement of business persons owing to the work programme in that area. 
4  INVESTMENT MEASURES 
4.1.  During the period under review, the Government of Malawi has undertaken several reforms 
to improve its business environment and ranking on the Doing Business Index. Malawi ranks 141 
in 2016, an improvement over 2015 ranking of 144, wi th a score of 51.03 better than the regional 
average of 49.66 albeit below all regional comparators.  
4.2.  Some key legislation that were passed to improve the business environment include the 
enactment of the  Insolvency Act, the Compan ies (Amendment) Act, the Personal Property 
Security Act which has seen the establishment of a Collateral Registry, the Credit Reference 
Bureau Act, and  the Business Registration Act, that operationalized online business registration.  
4.3.  The Government of Malawi has established the One-Stop-Service Centre (OSSC) through the 
Malawi Investment and Trade Centre (MITC), which is fully operational since September 2014 with 
four institutions on board – Immigration, Lands, Registrar of Companies and Malawi Revenue Authority (MRA).  The regulatory schematics of the OSSC will be streamlined into the legislation so that it remains statutory.  However, presently the OSSC is continuously working with the parent 
ministries and departments to further streamline processes and procedures. 
4.4.  The Government is currently reviewing the Investment and Export Promotion Act with 
s u p p o r t  f r o m  D F I D .   T h e  n e w  A c t  i s  e x p e c t e d  t o  g i v e  M I T C  m o r e  a u t h o r i t y  t o  u n d e r t a k e  i t s  
business of investment and trade promotion.  
4.5.  To stimulate foreign investment, Malawi continues to sign Bilateral Investment Treaties 
(BITs). During the period under review Malawi si gned a BIT with the Federal Government of Brazil 
and negotiated another with Mauritius. 
5  MALAWI AND THE MULTILATERAL TRADING SYSTEM 5.1  Implementation of WTO Agreements 5.1.  As a country which has premised its de velopment on a trade-based economic strategy, 
Malawi is committed to the WTO and its ability to help create an international trade environment 
and rules-based system as an integral part  of global economic and trade governance. 
5.2.  Malawi is committed to the multilateral trading systems as far as it supports the 
establishment of a fair and pro-development ru les-based trading system, which enhances trade 
potential and creates sufficient policy space for continued development. Malawi therefore advocates persistently that development is intrinsic in the multilateral trading framework. 
5.3.  Given the geographical status of Malawi, as a Landlocked Least Developed Country, we fully 
endorse the objectives of the Agreement on Trade Facilitation (ATF) and have since aggressively 
embarked on its implementation to ensure that we  fully benefit from this Agreement. The National 
Trade Facilitation Committee has been established. In terms of notifications to the WTO 
Secretariat, a draft schedule of commitment for all categories has been developed; national 
ratification process is underway, awaiting clearance by the Head of State before being submitted to the Secretariat. The country is already implem enting some aspects of the ATF including trade 
portal, national single window and one-stop border  post interventions are underway. It is therefore 
imperative that developed country partners honour the intent and spirit of this Agreement relating to technical and financial assistance.  
5.4.  Malawi's implementation challenge still remain s. This relates to the capacity to comply with 
WTO notification requirements, align national laws, rules and regulations to WTO requirements and WT/TPR/G/335 • Malawi 
 
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  enforce the laws and regulations, e.g.  Trad e Related Intellectual Property, Sanitary and 
Phytosanitary (SPS) Agreement, Agreement on Trade Remedies, Agreement on Technical Barriers to Trade, and comply with the Agreement on Customs Valuation and Dispute Settlement 
Procedures. 
5.5.  It is envisaged that Malawi’s participat ion in the global trading body and capacity to 
implement the global rules would be improved with the establishment of a Geneva office which is at an advance stage. 
5.6.  Malawi has received support from DFID’s Trade Advocacy Fund (TAF) in developing a trade 
negotiations strategy and management plan. The programme also undertook some capacity building activities which was aimed at equipping government officials with necessary negotiating skills and technical preparation for negotiations. 
5.7.  Also, Malawi continues to receive support from the Enhanced Integrated Framework (EIF) to 
address a myriad capacity challenges and help the country integrate into the world economy. 
5.8.  There still exist substantial capacity-building gaps due mainly to staff turnover and the 
current economic challenges that Malawi faces. Malawi therefore welcomes effective aid for trade 
supports from development partners.  
5.2  Implications of Other Trading Arrangements on Malawi 
5.2.1  Economic Partnership Agreements 
5.9.  Malawi is participating in the ACP-EU Economic Partnership Agreement (EPA) negotiations 
under the Eastern and Southern Africa (ESA) geographical configuration. Malawi has not yet signed the EPAs alongside Djibouti, Ethiopia, Eritrea and Sudan in the ESA region because issues of 
particular interest to the nation are not covered in the current interim EPAs.  
5.10.  The country, as an LDC, still continues to use the Everything But Arms (EBA) initiative to 
access the European Union (EU) market, which is part of the EU Generalized System of 
Preferences (GSP). However, Malawi realizes that it is a fact that global trade dynamics are 
changing and EPAs are no exception. The EPAs will  be EC’s future instrument for regulating its 
trade with the ACP member states and financin g ACP’s trade-related development programmes. 
5.11.  In view of the above, the country continues negotiating for a full EPA on all the outstanding 
issues until issues of interest to Malawi are addressed in the final EPA. Although Malawi is in ESA configuration, it would be imperative to arrange a high level bilateral forum between Malawi and the EU to afford an opportunity for elaborating in detail the country’s interests and structural 
challenges in implementing the EPAs. To this end,  the Ministry of Industry and Trade will review 
the country’s draft market access offer in view of the recent migration of customs data from HS 07 to HS 12. Furthermore, the Cabinet is yet to give national direction on EPAs. 
5.2.2  Generalized System of Preferences 
5.12.  Malawi’s benefit from the various GSPs such as the EC Everything But Arms (EBA) initiative, 
the China, Canada, Japan and India initiatives for Least Developed Countries (LDCs), and AGOA, 
has not changed since the last review. The main reason for the low utilization of most GSP 
preferences is the weak productive base and business operating environment. 
5.2.3   South-South Cooperation 5.13.  Malawi maintains a trade, investment and technical cooperation agreement with the 
People's Republic of China. As such, China continues to make significant contributions towards 
Malawi’s economy development through investment s and preferential market access opportunities. 
China has recently expanded the product coverage  for its Duty-Free-Quota-Free Market Access for 
Malawian products from 95% to 97%. China has also  recently given US$6 million to the Ministry of 
Industry and Trade for investment into value a dditions and institutional capacity building.  WT/TPR/G/335 • Malawi 
 
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  5.14.  South Africa remains Malawi’s major trading partner. Even though bilateral cooperation 
between the two countries during the period und er review has slowed down, both countries 
continue to actively engage under the SADC an d SADC-COMESA-EAC Tripartite Free Trade Area 
frameworks.  
5.2.4  Aid for Trade 
5.15.  Malawi’s need for Aid for Trade through programmes and projects has become more evident 
due to the withdrawal of direct donor budget su pport. Malawi as a Landlocked Least Developed 
Country (LLDC) faces several challenges to be integrated into the multilateral trading system. 
These ranges from supply-side constraints to trade facilitation issues. Malawi therefore endorses the WTO Trade Facilitation Agreement and therefore implores development partners to support its implementation. 
5.16.  Malawi continues to benefit from the Enhanced Integrated Framework and other Aid for 
Trade programmes. 
6  CONCLUSION 
6.1.  Malawi remains committed to maintaining an increasingly open economy, the Multilateral 
trading system and a timely conclusion of the Doha Development Round of trade negotiations. Malawi underscores the fact that in the context of the current global economic recession, an 
ambitious outcome of the Doha Development Round  is crucially important to create economic 
prosperity and growth globally. In this regard it is imperative that the Doha Development Round establishes a fair and pro-development rules-based multilateral trading system, which enhances the country’s trade potential and creates sufficient policy space to facilitate continued development 
6.2.  As a Least Developed Country, Malawi faces supply-side infrastructure and productivity 
constraints and is highly susceptible to fluctuations in commodity prices. As such, Malawi is hopeful that member States and cooperating partners will assist her in addressing supply-side constraints 
to enable the country to take full advantage of the market access opportunities created at the 
multilateral level.   
6.3.  The Malawi Government remains committe d to transforming its economy from being 
predominantly consuming and importing into bein g predominantly producing and exporting as a 
prerequisite for eradicating poverty.  In this regard, the MGDS II, among others, aims to mainstream trade into sectoral strategies. Whilst economic development prospects will depend on 
her ability to adjust, there will be need for increased support and assistance from the international 
community so as to grow an economy that is better able to absorb commodity price shocks in the 
future. 
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