Doing Business in Malawi

Agriculture forms the mainstay of Malawi's economy, accounting for nearly 30 percent of its GDP. Tobacco, tea, and sugar together generate over 70% of export earnings, with tobacco providing the lion’s share (over 60%). The agricultural sector employs nearly half of those in formal employment, and directly or indirectly supports an estimated 85% of the population (including subsistence farming). Malawi has a narrow economic base with little industry and mining, and only a few known economically viable deposits of gemstones or precious metals. Malawi’s first uranium mine was commissioned in late 2008 and will reach full production by the end of 2009. The mine is expected to add more than 5 percent to GDP and over 10 percent to export revenue over the next decade.

Malawi has a relatively free investment environment, but poor infrastructure (particularly unreliable electricity and water), high transport costs and bureaucratic hurdles tend to inhibit investors.

Some Government ownership/control of the economy through parastatal organizations and through share-ownership in large companies remains. The Government, however, has moved forward with its multi-sectoral privatization program. The Privatization Commission has disposed of 65 of the approximately 110 state-owned enterprises targeted for sale since 1996.