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REPUBLIC OF MALAWI

REPUBLIC OF MALAWI

Malawi, also known as “The Warm Heart of Africa" because of the friendliness of its people, was once known as Nyasaland. This southeast African country is now officially known as the Republic of Malawi. The name Malawi originated from the Maravi; an old name of the Nyanja people that first inhabited the area. The people then settled by migrating to Bantu which was colonized by the British. In 1964, the protectorate over Nyasaland ended their operations and Nyasaland became an independent country under Queen Elizabeth II, with the new name Malawi. The country became a republic after two years of attaining its independence with a totalitarian one-party state under the leadership of Hastings, Banda who presided until 1994. The country now remains a democratic multi-party state under Peter Mutharika’s leadership.

Map of Malawi

 As of July 2016, Malawi had an estimated population of 18,091,575 with Malawian as the official name for its citizens. There is a diverse population made up of native people, Asians, and Europeans, with several languages spoken and a variety of religious beliefs. The landlocked country is neighbored by Zambia to the northwest, Tanzania to the northeast, and Mozambique on the east, south, and west. The country spans over 118,484 km2 (45,747 sq mi) with Lake Malawi taking up about a third of the nation’s land. Lilongwe is the nation’s capital, and is also Malawi's largest city; the second largest is Blantyre, the third-largest in Mzuzu and the fourth largest is its old capital Zomba. Malawi has a pro-western foreign policy and has positive diplomatic relations and participation in several international organizations, including the United Nations, the Commonwealth of Nations, the Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (COMESA), and the African Union (AU), yet Malawi is among the world's least-developed countries with low life expectancy, high infant mortality and a high prevalence of HIV/AIDS.

  

Governance

Malawi’s current constitution was effected on the 18th of May, 1995 with a democratic, multi-party government and currently has the leadership of Dr. Peter Mutharika as the President. Malawi’s government consists of the executive, legislative and judicial branches. Malawi is divided into four regions (the Northern, Central, Southern and Eastern regions), which are further divided into 28 districts, and approximately 250 traditional authorities and 110 administrative wards. Local government is administered by the central government-appointed regional administrators and district commissioners.

Dr. Peter Mutharika

The Executive branch

The Executive branch of Malawi is made up of a President who is both Head of State and Head of government, first and second vice presidents and a cabinet. The President, with his Vice is elected into office every five years while the second vice president and the cabinet are appointed by the president. In the case of the second vice, they must be from a different party and for the members of the cabinet, they can be drawn from within or outside the legislature. 

 

Legislative branch

Malawi’s National assembly is the supreme legislative body of the nation, although the Malawian constitution provides for a Senate of 80 seats, Parliament repealed it and one does not exist in practice. The legislative branch consists of a Unicameral National Assembly of 193 members who are elected every five years. The National Assembly situated in Lilongwe possesses legislative supremacy and thereby, ultimate power over all other political bodies in Malawi with the Speaker of the House as the head. 

Judiciary

Malawi’s judicial branch interprets and applies the laws of the land to ensure equal justice under law, and to provide a mechanism for dispute resolution. The judicial branch is modelled after the English model and with the Supreme Court of Appeal as the highest; The Supreme Court of Appeal has jurisdiction only in appeals from lower courts. It is composed of the Chief Justice and nine other Justices, followed by the High Court which is divided into three sections (general, constitutional and commercial): The High Court of Malawi has unlimited original jurisdiction to hear and determine any civil or criminal proceedings. It has a General Division which also hears appeals from subordinate courts, and a Commercial Division that deals with commercial or business-related cases. About one-third of Most High Court cases are brought before a single judge, without a jury, but cases on constitutional matters must be heard by three judges. The Industrial Relations Court has jurisdiction over employment issues. The Subordinate Courts include an Industrial Relations Court and Magistrates Courts. The Industrial Relations Court presides over employment cases before it is heard informally, and with some restrictions on legal representation, by a panel consisting of a chairperson and one representative each of employers and employees. While others include magistrates' courts and local or traditional courts. These have defined criminal and civil jurisdiction depending on their level, but expressly excluding cases of treason, murder or manslaughter.


ECONOMY

Real Growth in GDP 2009 2018

Landlocked Malawi ranks among the world's least developed countries. The country’s economic performance has historically been constrained by policy inconsistency, macroeconomic instability, poor infrastructure, rampant corruption, high population growth, and poor health and education outcomes that limit labor productivity. The economy is predominately agricultural with about 80% of the population living in rural areas. Agriculture accounts for about one-third of GDP and 80% of export revenues. The performance of the tobacco sector is key to short-term growth as tobacco accounts for more than half of exports, although Malawi is looking to diversify away from tobacco to other cash crops.

The economy depends on substantial inflows of economic assistance from the IMF, the World Bank, and individual donor nations. Donors halted direct budget support from 2013 to 2016 because of concerns about corruption and fiscal carelessness, but the World Bank resumed budget support in May 2017.

In 2006, the country qualified for debt relief under the IMF/World Bank Heavily Indebted Poor Countries Initiative – Malawi has one of the lowest per capita incomes in the Commonwealth.

These reforms led to a gradual recovery, with better agricultural performance, higher commodity prices (notably for tea) and increased export earnings. However, during 2000, with a poor maize harvest, weaker tobacco prices and the growing burden on the economy of the loss of skilled workers and health care costs of HIV/AIDS, growth slowed and then in 2001 the economy shrank by more than four per cent. It recovered in 2002 in a climate of persisting drought and generally maintained good rates of growth, becoming strong during 2006–09. Then, following the world economic downturn of 2008–09, there was a brief pause, before growth of at least five per cent p.a. resumed in 2013–15. Keeping inflation under control, however, proved more challenging; it was 27.3 per cent in 2013 and an estimated 19.6 per cent in 2014.

Heavily dependent on rain-fed agriculture, with corn being the staple crop, Malawi’s economy was hit hard by the El Nino-driven drought in 2015 and 2016, and now faces threat from the fall armyworm. The drought also slowed economic activity, led to two consecutive years of declining economic growth, and contributed to high inflation rates. Recent increases in domestic borrowing mean that debt servicing in 2016 exceeded the levels prior to HIPC debt relief. Depressed food prices over 2017 led to a significant drop in inflation (from an average of 21.7% in 2016 to 12.3% in 2017), with a similar drop in interest rates.

GDP by Sector 2015

AGRICULTURE

Agriculture is the backbone of Malawi’s economy, directly accounting for about one-third of the nation’s GDP. Agriculture significantly contributes to employment, economic growth, export earnings, poverty reduction, food security, and nutrition. This sector competes most successfully in international markets. The main economic produces of Malawi are tobacco, tea, cotton, groundnuts, sugar, and coffee. While maize has been the major food crop in terms of the policy agenda and hectarage planted, tobacco has been the dominant cash crop in the economy accounting for approximately 58% of the country’s total export earnings with a production in 2011 of 175,000 tonnes over the last century. Tea and sugar are other important cash crops accounting for 8 percent and 7 percent of export earnings, respectively. Dried legumes, nuts and groundnuts have increased in relative importance while cotton has decreased. Livestock production, which contributes about one-fifth of the value of total agricultural production, consists mainly of subsistence grazing of sheep, cattle, goats, poultry, and pigs. Other agricultural products include cassava, sweet potatoes, sorghum, bananas, rice, and Irish potatoes. Malawi’s agriculture sector is composed of two main sub sectors: small-scale farmers and estates. Despite lacking resources, smallholder farmers produce about 80 percent of Malawi’s food and 20 percent of its agricultural exports. The estate subsector is the nation’s principal foreign exchange earner. While it contributes only about 20 percent to the total national agricultural production, it provides over 80 percent of agricultural exports mainly from tobacco, sugar, tea and, to a lesser extent, tung oil, coffee, and macadamia. The estate sub sector operates on leasehold or freehold land. Lake Malawi and Lake Chilwa provide fish for the region.

 Tobacco Farming in Malawi

INDUSTRY

Malawi's manufacturing sector contributed 10.7% of GDP in 2013. The main industries are food processing, construction, consumer goods, cement, fertilizer, ginning, furniture production, and cigarette production. The Ministry of Industry, Trade and Tourism’s spokesperson, Mayeso Msokera has largely attributed the slow industrial growth to insufficient and intermittent power supply the country has experienced in recent years.

Food and beverages: Most fruits and vegetables are exported raw, while processed food is imported mainly from South Africa.  Companies like Carlsberg and Universal Industries are into brewery and sweets, crisps, biscuits, milk powder, soy products, and baby food respectively. Coffee and tea are processed by half a dozen different companies in the regions of Thyolo, Mulanje and around Mzuzu. 

Pharmaceutical companies: Pharmanova Ltd., which is the biggest pharmaceutical manufacturer in Malawi, followed by SADM, Malawi Pharmacies (Pharmaceuticals Limited) and Kentam Product Limited are the four pharmaceutical companies in Malawi. They manufacture a limited range of drugs, particularly those that are in great demand on the local market.  

Forestry: Timber production for building materials and furniture is an important industry. However, most areas in Malawi suffer from deforestation due to illegal logging for charcoal production and the use of firewood

Electricity: Electricity Supply Commission of Malawi (ESCOM) is Malawi's sole power supplier and is state-owned. It generates almost all its power from hydroelectric plants along the Shire River. The installed is approximately 351MW. About 12% of the country's population has access to electricity, according to 2014 World Bank figures. 

Mining

The mining sector in Malawi accounts for about 1% of the country’s GDP. In 2017, growth in the mining and quarrying sector was estimated at 1.6%. Growth in 2018 was projected at 2.3%. Mining remains small-scale, and Malawi has no precious metals or oil, but ruby mining began in the mid-1990s, with Malawi the only source of rubies in Africa. The value of mining is dominated by the extraction of fuel minerals, particularly uranium. Malawi's production of uranium has contributed 1% to the global production of this mineral. Malawi has several minerals with economic potentials, such as Phosphates (apatite), Bauxite, Kaolinitic, Coal, Kyanite, Limestones, Rare Earths (including Strontianite and Monazite), Graphite, Sulphides (Pyrite and Pyrrhotite), Titanium minerals along the Lakeshore, and Vermiculite. Artisanal and Small Scale Mining (ASM) in Malawi is generally carried out through labor-intensive methods for limestone for lime production, clay for pottery, and gemstones. Small scale mining is facilitated by Mineral Permits, Mining Claim Licences, and Reserved Mineral Licences. It is estimated that with increased emphasis on mineral extraction, the sector's contribution to GDP could be 20% by 2023.

Manufacturing

Mapeto DWSM Ltdjpg

Major products in the manufacturing industry include: textiles, footwear and clothing, agro-processing (tobacco, tea, sugar, soya, macadamia nuts) and building materials (cement, joinery).  In recent years the production of tobacco in Malawi has decreased significantly. Some major players in the manufacturing sector are Mapeto (DWSM) Ltd., the largest textile manufacturer in Malawi, Mapeto (DWSM) manufacture large quantities of yarn from the initial spinning process right through to printing and dying. They are one of the country’s largest importers and employ over 1000 workers. Malawi has over the past 30 years failed to make headway in the manufacturing sector, leaving analysts wondering whether the promotion of import substitution, industrialization and agricultural exports is yielding results. World Bank analysis suggests that the market for manufacturing is limited partly due to Malawi’s relatively small domestic market; while the shortage of skilled workers, low productivity and high transport costs in Malawi limit the capacity for the exportation of manufactured goods.

SERVICES

Malawi’s service sector accounts for 51.7% of the national GDP. Notable industries are tourism, retail, transport, education, health services, telecommunication, and the banking sector. The Government of Malawi holds shares in many important companies, such as Malawian Airlines and Press Corporation Limited.

FINANCIAL SECTOR

Malawi's financial sector is small even by regional standards and is dominated by banks but with a variety of institutions and markets. The Malawian financial system consists of nine banks, two discount houses, one leasing company, eight insurance companies, four development finance institutions (DFIs), a young but growing microfinance industry, and a nascent capital market. Only 10% of Malawi's population has access to formal financial services, reflecting the high incidence of poverty, high degree of informality, and a high proportion of the population in rural areas. Malawi's financial system offers a variety of conventional financial services, concentrated on the short-term end of the yield curve, but with an increasing focus on down-market products. Significant ownership linkages within the financial system and with non-financial corporations pose challenges for governance and related party transactions.

Banking

Image: Reserve Bank of Malawi

Malawi has a small banking system, which has a low but increasing level of financial intermediation. The banking system is concentrated and largely privately owned. Generally, Malawi has a sound banking sector, overseen and regulated by the Reserve Bank of Malawi, The Central Bank of Malawi.  There are ten full-service commercial banks.  The two largest banks-- National Bank of Malawi Standard Bank, First Merchant Bank, and Indebank -- collectively command 51% of all banking deposits. 

 

TRANSPORTATION SECTOR

Malawi’s transportation is poorly developed. The country of almost 14 million has 39 airports, with only 6 with paved runways and 33 with unpaved runways. It has 495 miles (797 km) of railways, all narrow-gauge and about 45 percent of its roads are paved. Malawi also has 435 miles (700 km) of waterways on Lake Malawi and along the Shire River.

Highways: Recent assessment has indicated that there are 9,601 miles (15,451 km) of roads in the country; of these, 4,322 miles (6,956 km) (45 percent) are paved. The remaining 5,279 miles (8,496 km) are not paved.

Ports, harbors and waterways: The major waterways are Lake Nyasa or Lake Malawi and the Shire River. There is a railhead at the port of Chipoka, Salima district in Central Malawi. There is also the existence of smaller ports at Monkey Bay, Nkhata Bay, Nkhotakota and Chilumba.

The MV Ilala connects Likoma Island with the mainland, as well as the Malawian and Mozambican sides of the lake. 

Air transport: The national airline of Malawi, Malawian Airlines Limited operates regional passenger service in Lilongwe and is 51% owned by the Malawi government as Ethiopian Airlines controls the remaining 49%. The airline's main base of operations is Lilongwe International Airport, with a secondary hub at Chileka International Airport

Image: Lilongwe International Airport

Rail transport: The government owned Malawi Railways is the national rail network in Malawi but since 1 December 1999 the Central East African Railways, a consortium led by Railroad Development Corporation, won the right to operate the network. This was the first rail privatization in Africa which did not involve a parastatal operator. The rail network totaled 797 kilometers in 2001. It is a narrow gauge line with a 1,067 mm (3ft. 6in) track.

 

TELECOMMUNICATIONS

The overall telephone system is described as rudimentary. In the past, Malawi's telecommunications system was named as one of the poorest in Africa, but conditions are improving. Telephones are much more accessible in urban areas, with less than a quarter of land lines being in rural areas.

Telephone: Mobile telephones are much more common than fixed line phones in Malawi, with over 6.1 million mobile subscriptions compared with only 45,678 fixed line subscriptions as of 2015.

The International Telecommunications Union report showed that the average Malawians spend on mobile phones was over 56% of the average monthly earning there. This was the highest proportion of earnings revealed by the survey. There are the domestic telecommunication systems consisting of fair system of open-wire lines, microwave radio relay links, and radiotelephone communications stations and the international also made up of satellite earth stations - 2 Intelsat, 1 Indian Ocean and 1 Atlantic Ocean.

Radio and television: The Malawi Communications Regulatory Authority (MACRA) regulates Radio and television broadcast services in Malawi. 

There are 31 are operational radio broadcast stations, but 45 licensed. There are also 20 licensed television broadcast stations, of which only 5 or 7 are operational.

Internet: By late 2018, 1.8 million Malawians were online, around 9% of the population. There were 540,000 active social media users by January 2019 with Facebook as the leading platform. The internet in Malawi is also regulated by the Malawi Communications Regulatory Authority (MACRA). Business to consumer Internet service providers include Airtel, and Malawi Postal Service.

TOURISM

Image: Kasungu National Park

Malawi is famously known for its most welcoming, warm and friendly people, hence the Warm Heart of Africa and it has considerable potential for tourism. Some main tourist sites are Lake Malawi: Lake Malawi spans from the Northern region of the country through the Southern region with its northern part being the deepest. Mountains such as Zomba Plateau and Mulanje Mountain, not forgetting the country's national parks like Nyika National Park, Kasungu National Park, and Liwonde National Park and Lake Malawi National Park. There also are the rock paintings at Chongoni. Aside these, there are many beautiful beaches along the shores of Lake Malawi like Kande Beach and Chintheche Inn in Nkhata Bay.

 

CULTURE

Chewa is the most widely spoken language in Malawi used by 60 percent of the population, which originated among the Bantu tribes of South Africa. 5 percent of the people speak Yao, and 30 percent speak Arabic with English as the official language of government, industry, commerce and in schools.

Chickens, goats, and an occasional pig are used to supplement the standard dish of boiled cornmeal called nsima. Nsima is eaten twice a day, usually at lunch and dinner, and is preferred by most people. Fruits that abounds in Malawi includes mangoes, melons, oranges, bananas, and pineapples. Vegetables are cultivated but are not popular.

Soft drinks are quite dominant, especially Coca-Cola. Alcoholic beverages are mainly beer, a homemade brew called chibuku, that is usually produced by women and served in cut-off milk cartons, and a more potent distilled liquor. Most Malawian ceremonies involve the consumption of alcoholic beverages.

Verbal greetings are accompanied by a handshake. This is done with the right hand, with the left hand gripping the right forearm to show that one is not armed. Though residents are gregarious, they respect other people's privacy in a crowded country where private space is at a premium. While approaching someone's house one would often cry Odi, Odi to announce his or her presence. Eating usually is done without utensils, but only with the right hand, because the left hand is considered "dirty."

55 percent of the people belong to the Church of England but there are also Methodists, Baptists and Seventh Day Adventists. 20 percent of the population are Muslim, and 20 percent are Catholic. There is a small Hindu presence.

Death is a constant presence in Malawi because of the short life expectancy, the growing incidence of AIDS and other diseases, and the high infant mortality rate. Employers give workers time off for funerals, and funerals and mourning can last several days.

Malawi has a National Dance Troupe which is partially subsidized by the government and receives the only governmental financial support to the arts in the country. 

Image: Gule Wamkulu -The Masked Malawi Traditional Dance

There is a long tradition of oral artistry. Before the spread of literacy in the twentieth century, texts were preserved in memory and performed or recited. Those traditional texts provided entertainment, instruction, and commemoration. However, no distinctions were made between works composed for enjoyment and works with a more utilitarian function. Those works were primarily myths, legends, and folktales.

 

SPORTS

Malawi’s most common sport is football. Its national team is yet to qualify for a World Cup but have made two appearances in the Africa Cup of Nations. Basketball is also growing in popularity, but its national team is yet to participate in any international competition.

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