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by
Ephraim Munthali, 13 October 2003
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17:23:01
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Malawian products are on high demand in Mozambique but the stalling of a bilateral deal between the two countries that could reduce tariffs and cut other trade barriers is preventing the locals from cashing in on that market.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI), which organised a two-day exhibition of the country’s products dubbed ‘Malawi Week’ in Nampula, Mozambique said Malawi can benefit from doing business with its eastern neighbour if all the hurdles were minimised.
The chamber said Malawi products have an advantage on the Nampula market because of the shorter distance from the producer to the buyer as compared to the current South African or Brazilian-based suppliers of similar products.
MCCCI said since transport costs, one of the major determinants of price in the export business, are greatly reduced, Malawi products are more competitive.
“The decision to do business with Mozambique was easier for the companies that took part in the exhibition after discovering the potential for exporting to this market.”
“However, many Malawian companies have been reluctant to do business with Mozambique despite known demand for their products because of existing trade barriers which include high tariffs, cumbersome customs procedures and other non-tariff barriers,” said the chamber.
Mozambique’s tariffs are said to be relatively high in comparison to other countries in the region most of whom are Comesa member countries whose goods are being traded on preferential basis. The country, together with Tanzania, is no longer a member of the Free Trade Area (FTA).
Agma Corporation, Candlex, Agrimal, Charles Stewart Day Old Chicks and Malawi Distilleries Limited (MDL) participated in the show. Products on show were fruit juices, eggs, agricultural tools, bolts and nuts, gin and brandy.
According to MCCCI, the products were well received by major traders in that country. The chamber said the five companies are negotiating with their new business contacts for orders and distribution arrangements.
“The majority of the companies are considering that they might send out the first shipments before the end of the year. One of the companies has already decided that it will establish a production plant in Nampula soon,” the chamber said.
Candlex Limited marketing manager Fredrick Changaya, whose company has appointed six agents in Mozambique for the distribution of their products, has since asked MCCCI to lobby the Ministry of Commerce to finalise bilateral talks with Mozambique so that local producers can rake in more profits.
Meanwhile, MCCCI has also appealed to government to facilitate the development of the infrastructure along the Nacala Development Corridor to attract investors. |
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