Malawi: The ‘Warm Heart of Africa’ Looks to Agri-Industry to Achieve Its Economic Goals

In 1985, I was returning from central Africa en route to South Africa. Malawi was an obvious transit stop with direct flights between the Malawian capital of Lilongwe and Johannesburg. I checked into the Capital Hotel and hired a small car to see as much of the country as possible during the two days before my flight home. 

I proceeded along a tarred strip road for about 130 kilometres to the town of Salima on the coast of Lake Malawi. (The narrow, one-way strip roads are quite daunting, as one vehicle has to give way and leave the road to oncoming traffic. I was uncertain of the rules and when I had right of way.)

I spent a few relaxing hours swimming and trying to grab the small fish darting about in the lake’s clear waters. Back in the car, I continued on a dirt road in the direction of the lakeside resort, Monkey Bay. Although it was a sunny day, recent heavy rains had left large puddles for me to dodge. On approaching a village, I found myself in a particularly deep spot with water beginning to stream in at my feet. A small group of boys in ragged shirts appeared from nowhere, frantically waving their hands. I followed their directions, and was greatly relieved when my tyres hit dry ground. I waved my thanks and they waved back, jumping and laughing. No begging. I had just experienced the famed Malawian ‘warm heart’.

Malawi is a small country of only 118 480 square kilometres, which lies along the western shoreline of Lake Malawi, (called Lake Nyasa and Lago Niassa in neighbouring Tanzania and Mozambique). It is bordered in the west by Zambia. Lake Malawi is 570 kilometres long and 75 kilometres wide at its widest point. Lilongwe is the capital city, but Blantyre is the main commercial centre.

Malawi is ranked one of the poorest countries in the world, with a GDP per capita estimated at US$572 at the end of 2024. Average inflation is high at 21% (although recent analyses indicate that this rate is dropping slightly). In late 2023, the Malawian Kwacha was devalued by 44%. The main donor agencies predict annual GDP growth at about 2%.

The total population is around 21 million. In 2022, it registered one of the highest population densities in the world at 221 people per square kilometre. This density factor is worsening due to the country’s high annual population growth of 2,7%. The population is expected to double by 2038. Youth unemployment stands at nearly 30%. Economic activity is constrained by poor transport, power and water supply infrastructure. (Although there are some major developing infrastructure projects such as the 300 MW coal-fired Kam’mwamba power station scheduled for completion in 2025, the Malawi-Mozambique Transmission Interconnector Project, and the National Fibre Backbone Project led by Huawei.)

Only 18% of the population live in urban areas. Some 90% of Malawians live off subsistence farming, and this has led to severe soil erosion, deforestation and general environmental degradation. Recent droughts have worsened the situation.

Non-agricultural activity is based mainly on mining (coal, uranium, phosphates, bauxite, limestone, rare earths, graphite, and titanium). Tourism is a major hard currency earner, based largely on the allure of Lake Malawi and its enticing leisure offering, as well as a few game reserves. Small and medium-sized industries are producing textiles and clothing, footwear, building materials and consumer goods. They also produce some processed foods. Services account for a large proportion of GDP at nearly 55%, while industry amounts to only 18,35% with agri-processing superseding other industries.

Malawi produces a wide range of crops. Maize is the staple food but tobacco is the main cash crop generating export revenue, followed by tea, sugar, coffee and groundnuts. Cattle, fisheries and forestry are other related activities. Agriculture accounts for nearly 22% of GDP and is clearly the dominant sector.

The Malawi Investment and Trade Centre and the Ministry of Trade and Industry are driving the SEZ/Industrial Parks Programme. Areas with agri-industrial potential are being designated for development as specialised SEZ’s. The Green Belt Initiative aims to promote large-scale commercial irrigation and efficient use of land and water for the production of export-grade crops in selected areas of the country. US$563 million has been allocated to the Shire Valley Transformation Programme which will use advanced irrigation systems. Arise Integrated Industrial Platforms is a powerful joint venture funding agency with the Africa Finance Corporation, Afreximbank and the African Transformation and Industrialisation Fund as partners. It is collaborating with the Malawi government and local companies for the establishment of a US$ 164 million SEZ and dry port in an area north of Lilongwe. The objective is to develop and operate an agri-industrial ecosystem which will create 132 000 much-needed direct jobs, as well as an undetermined number of secondary jobs. It should be operational by 2026.

Thanthwe Farms and Thanthwe Products is an innovative agri-business established by the dynamic, lady social scientist-turned-entrepreneur, Nagabaghila Chatata. It was started in 2012 and is situated outside Lilongwe. Thanthwe has established a system of greenhouse cultivation of high-value crops with export potential such as tomatoes, lettuce, cucumber and peppers. Green technologies such as solar driers are used for products such as dried fruits and ginger powder. Feedstock is from over 5 000 small-holdings. Employees are mainly women and youths. Business incubation and training is offered to all.

Afri-Oils is a specialised groundnut processing and marketing operation. It aims to move thousands of smallholder farmers up the value chain to produce value-added peanut products such as peanut butter and therapeutic foods for local and export markets. The pan-African agri-industrial investment company, AgDevCo has invested US$1,5 million in the Afri-Oils production plant in the Njewa industrial zone in Mchinji. 

The government is aiming at achieving middle-income status for the country by 2030. It is striving to make Malawi self-reliant economically by 2063. While these objectives may be considered highly ambitious, they will have the effect of energising government, business and society to escape the poverty cycle.

I’ve not been back to Malawi for a while. There are memories of the country which I wish to revisit. One is that of the delicious chambo freshwater fish from Lake Malawi which the Capital Hotel served for breakfast, lunch and dinner. A smear of mayonnaise on fried and crumbed chambo, and culinary heaven awaits.