Mining & Trade News

The Reserve Bank of Malawi (RBM) says access to credit facilities is one of the key fundamentals required for Malawi to transform to a private sector driven economy.

RBM Governor Dalitso Kabambe said this in Blantyre during the launch of the Credit Awareness Week which runs from December 9 to 15, 2019.

During the week the Central Bank conducts an awareness campaign on the benefits of following effective credit management practices and use of credit history reports from Credit Reference Bureaus.

Kabambe said the awareness campaign will result in increased understanding of credit access and usage by many Malawians for their economic empowerment and development.

He pointed out that for three consecutive years the country’s economy has stabilized with inflation currently at 9.3%, hence it is an opportune time for local citizens to access credit facilities to boost their capital.

“This week is of paramount importance to local citizens as Malawians will gain knowledge on merits of borrowing money from licensed or registered lending institutions including banks, microfinance institutions and savings and credit cooperatives (SACCOs) as opposed to borrowing from informal lending institutions,” he said.

Currently, only 3% of the Malawi population has access to credit from formal lending institutions, as the rest opt for informal institutions including village banks, a fact that Kabambe attributed to financial illiteracy.

In his remarks, Executive Director for Consumers Association of Malawi (CAMA) John Kapito urged financial institutions to uphold better customer care services.

Kapito said, among others, banks should ensure that customers are conversant with consumer rights and obligations when accessing loans.

He said: “During the recent years we have seen informal lending institutions growing drastically as opposed to formal institutions due to fair packages that the facilities offer to borrowers hence the need for commercial banks to borrow a leaf from such institutions”.

“Formal sector must invest much in understating credit terms and conditions among others interest rate, repayment period, short term or long term loan and consequences of default before signing a credit agreement between a lending institution and a borrower.”

Other sponsors for the awareness campaign include Bankers Association of Malawi, Malawi Microfinance Network, and Malawi Union of Savings and Credit Cooperatives.

In order to disseminate the core financial literacy messages within the week, RBM is among other things running financial literacy clinics and conducting credit awareness workshops with some of the major stakeholders.

Facebook has challenged local businesses to embrace social media in their marketing strategies in order to extend their markets. 

The Company is implementing a Community Leadership Circles (CLC) Program to bring together digital marketers and Community leaders to connect and share experiences on updated features it has introduced to fast-track communication processes on the social platform.

CLC Blantyre lead Frank Kamanga said that social media platforms have proven to be an efficient and cost effective means of disseminating business information due to their connectivity power which enables businesses to reach out to the global audience.

He said: “Whether you have an offline business or online, you can promote your business to the largest audience through social media.”

“The whole world is open for you through social media which makes the businesses profitable as marketing through social media is not expensive as other platforms and is very efficient in terms of reaching out to the wider audience.”

Kamanga, however, said there is more to be done in Malawi to ensure full utilization of the social media in this digital era.

He advised the government to come up with sound policies to increase Internet accessibility and lower prices for data usage.

“Social media is important as it creates awareness and innovates the way people live. It is the social media which has helped people discover new and innovative stuffs that can enhance personal lives. From farmers to teachers, students to lawyers, every individual of the society can benefit from the social media and its awareness factor,” he said.

Meanwhile, Facebook has launched a tool that will enable members to transfer photos and videos they have uploaded to the platform to Google Photos.

British Broadcasting Corporation reported that the service will initially roll out in Ireland and then in 2020 across the world, and it is designed to include other services in future as part of the Company’s commitment to “data portability”.

Facebook’s Google Photos tool is part of the Data Transfer Project, which aims to provide an open-source platform anyone will be able to use to move data between online services.

Apple, Google, Microsoft and Twitter are also involved in the collaboration.

The Malawi Government is preparing to develop an automated business registration system at the Registrar of Business Names Offices in Blantyre. 

The assignment will be financed by the World Bank as part of the US$95-million Agricultural Commercialization (AGCOM) project.

The Ministry of Agriculture, Irrigation and Water Development is, meanwhile, inviting sealed bids from eligible bidders for designing, supplying, Installing and commissioning of the Business Registration System (MBRS) within an implementation period of 6 months.

“Bidding will be conducted through international competitive procurement using Request for Bids (RFB) as specified in the World Bank’s procurement regulations of July 2016 revised in November 2017 and is open to all eligible bidders as defined in the procurement regulations,” states the Ministry.

Bidders are required to pay a non-refundable fee of MWK40, 000 or USD$50 payable by cash or direct deposit to purchase bidding document in English to be sent by courier or email.

The deadline for submission of bids is January 17, 2020.

In another development, the Ministry is expected to hold its 12th Joint Sector Review (JSR) workshop at Crossroads Hotel in Lilongwe.

The JSR will be conducted under the theme of ‘Creating a sustainable and resilient Malawi through irrigation, water and sanitation.’

In a statement, Principal Secretary in the Ministry, Grey Nyandule Phiri says the JSR provides a platform and mechanism for harmonization and improved sector policy dialogue and coherence.

Phiri says: “The annual review is aimed at reaching a common view among key stakeholders on important achievements in the sector in the preceding year, key implementation challenges, and progress against strategic policies.”

“Achieving consensus on priorities is a key in informing the future plans and budgets which provides focus for development partner support.”

Phiri further says the JSR has been organized to assess progress towards the achievement of the agreed headline indictor for the irrigation, water and sanitation sector.

He says the review will bring together pertinent issues hindering irrigation, water and sanitation development with the view to making recommendations for institutional and policy reforms to feed into the medium term planning and budgeting exercises.

Annual sector performance report for 2018/19 financial year will form the basis for the assessment and discussions at the event.

Minister of Agriculture, Irrigation and Water Development Kondwani Nankhumwa (MP) is expected to be the guest of honour.  

Shayona Cement Corporation says it is committed to increase cement production to ensure that it employs more Malawians and provide more business opportunities to companies operating in Malawi in order to play a major role in Malawi’s economic growth.

Shayona MD Jitendara Patel said this at Tata Zambia Malawi Branch offices in Lilongwe when his Company received 24 Tata Trucks which it has procured for distribution of cement across the country.

“Shayona is a Malawian company. I, the founder, was born in Mulanje, and my vision is to see the Company growing to make Malawi self-reliant on cement production since importation of cement is a drain on the country’s foreign exchange,” he said.

Patel hailed the long time relationship between his Company and Tata, which he said, will continue to bear more fruits.

He said Shayona expects to procure more trucks from Tata as it continues with its expansion drive, which will see the company building infrastructure for a logistics department at Kanengo Industrial area in Lilongwe.

Head of Aftersales and Administration at Tata Zambia – Malawi Branch Karthik Rajagopolan thanked Shayona for maintaining the business relationship with his Company saying the advantage of buying from Tata, unlike other overseas dealers, is that its local presence makes it easier for a customer to access back up services.

The Consumers Association of Malawi (CAMA) has pleaded with the Business community to refrain from hiking prices of essential commodities and services in response to the recent fuel price hike.

Malawi Energy Regulatory Authority (MERA) announced new fuel prices last week, and petrol is now selling at K930 per litre from K868, representing a 7.14% increase while the price of diesel has increased with 5.72% as a litre now costs K924 from K874, while MERA maintained the price of Paraffin at K710 per litre.

MERA stated that it resolved to adjust the prices upon assessing recent trends in the world petroleum products prices and changes in other macroeconomic fundamentals in the local market and their impact on energy prices.

Among other factors MERA said “the average prices of Petrol, Diesel and Paraffin increased by 16.12%, 11.55% and 6.05%, respectively, when compared to the averages obtained in the month of December 2018 used in determining the ruling pump prices, and the last In Bond Landed Cost (IBLC) review in January 2019, when pump prices were last revised.

It also said the Malawi Kwacha slightly depreciated by 0.30% to K742.01/USD from K739.78/USD.”

“The Board also considered liquidity of Price Stabilisation Fund (PSF). Since the last price revision in January 2019, MERA has been using the PSF to cushion importation losses as Free On Board (FOB) prices remained higher than the prices used in December 2018 due to geo-political factors and Organisation of Petroleum Countries (OPEC) member countries’ decision to reduce production in support of oil prices,” said MERA in the statement.

Commenting on the development, CAMA Executive Director John Kapito, says it is unfortunate that government has little control over the incident as MERA has made the decision to allow importers recover importation costs directly as the PSF can no longer contain the difference between demand and actual landed cost of petroleum products.

However, Kapito argued that the business community including bus operators should not use the price hike as a token to skyrocket prices of essential commodities and services as a lot of Malawians are in financial problems.

“At the moment we cannot deny what the market requires to be done, but our appeal as consumer body is for business operators to restrain from raising prices as the current amendment is very mean hence has very little impact on prices of social amenities.” Kapito says.

MERA maintained the retail price for Liquefied Petroleum Gas (LPG) at MK1,744.75 despite the landed cost of LPG increasing by 8.42% as it resolved to apply the Price Stabilization Fund to cushion anticipated importation losses.

The Malawi Government has hiked the buying price of maize at all Agricultural Development and Marketing Corporation (Admarc) rural markets and depots from K150 to K250 per kilogramme. Secretary for the Ministry of Agriculture, Irrigation and Water Development Grey Nyandule-Phiri says in a statement that the move is aimed attaining national food security as it will attract more farmers stocking maize to sell to the parastatal. Nyandule-Phiri says the government has made the decision to hike the buying price for the staple food crop after noticing that there was a slow pace of inflows to Admarc implying that the previous buying price was not attractive to farmers. “Government has, therefore, revised the buying price to K250 per kilogram for all maize delivered to Admarc depots and K230 per kilogram for all maize delivered to Admarc rural markets,” he said. The Ministry has since given local farmers and traders two weeks to sell their maize to any Admarc markets and depots, and says it will seek importation of maize from suppliers identified outside the country if it fails to secure enough maize by November 25, 2019. The Malawi Government commissioned the Strategic Grain Reserve with the aim of stocking maize. Nyandule-Phiri says the arrangement has assisted in ensuring that the country has maize stocks in adequate quantities acquired through procurement by Admarc and National Food Reserve Agency.

The Malawi Government has hiked the buying price of maize at all Agricultural Development and Marketing Corporation (Admarc) rural markets and depots from K150 to K250 per kilogramme.

Secretary for the Ministry of Agriculture, Irrigation and Water Development Grey Nyandule-Phiri says in a statement that the move is aimed at attaining national food security as it will attract more farmers stocking maize to sell to the parastatal.

Nyandule-Phiri says the government has made the decision to hike the buying price for the staple food crop after noticing that there was a slow pace of inflows to Admarc implying that the previous buying price was not attractive to farmers.

“Government has, therefore, revised the buying price to K250 per kilogram for all maize delivered to Admarc depots and K230 per kilogram for all maize delivered to Admarc rural markets,” he said.

The Ministry has since given local farmers and traders two weeks to sell their maize to any Admarc markets and depots, and says it will seek importation of maize from suppliers identified outside the country if it fails to secure enough maize by November 25, 2019.

The Malawi Government commissioned the Strategic Grain Reserve with the aim of stocking maize.

Nyandule-Phiri says the arrangement has assisted in ensuring that the country has maize stocks in adequate quantities acquired through procurement by Admarc and National Food Reserve Agency.

There is a need for the country’s small-scale farmers to form cooperatives if they are to graduate from subsistence to commercial farming.

Registrar of Cooperatives in the Ministry of Industry, Trade and Tourism Wiskes Nkombezi said this atthe official launch of the Cooperative Development Activity 4 (CD4) project which is being implemented by US premier agribusiness company, Land O’Lakes, with funding from USAID to the tune of $1.7 million.

Nkombezi said: “The Government of Malawi is encouraging farmers to come together, through cooperatives and pursue farming as a business; the CD4 comes in as a part player, joining the Government of Malawi and other development partners to further this agenda”.

He expressed gratitude towards development partners who are taking part in strengthening farmer based organizations saying it would be difficult for the government to succeed in the project without their support.

“Collaboration is very important. Therefore, I take this opportunity to request all partners present today to synergize your efforts, as we all continue to contribute to the development and growth of the Cooperative Movement in Malawi. We will achieve the goal of sustainable economic growth and poverty reduction if we continue working together”, Nkombezi said.

The CD4 aims to improve the cooperative enabling environment by strengthening apex organizations and by promoting a Cooperative Learning Platform, enhance cooperative business performance through tailored technical assistance and to advance development communities support for cooperatives through supporting research in cooperatives and disseminate findings through both local and global channels.

Nkombezisaid the project is important to strengthen cooperatives as some collapse due tolack of knowledge on how to run them as business enterprises.

“Cooperatives need technical capacity strengthening to support their sustainability and growth. If cooperatives are strengthened in aspects of business operations, they are empowered to make sound business decisions which in turn enhances their growth,” Nkombezi said.

In his remarks, USAID Office Director Cullen Hughes said CD4 has come in at an opportune time when Malawi government and development partners are strategizing on the implementation of the National Agricultural Policy (NAP).

NAP emphasizes on developmentof farmer organizations as a key intervention for driving Malawi’s agricultural development.

“In response to the need for strong farmer organizations in the operationalization of the NAP, the Department of Agricultural Extension Services has developed a strategy for farmer organization development to which the program being launched today is closely aligned,” he said.

Agriculture remains the driving force of Malawi’s economy contributing approximately one third of the country’s Gross Domestic Product (GDP) and nearly 80%of export revenue.

A grouping of Artisanal and Small-scale Miners (ASMs) the Nyasa Mining Cooperative Society says there is a need for Malawi to heavily invest in the ASMs in order for the country’s gemstone products to compete on the world market.

In an interview with Mining & Trade Review, the Cooperative’s chairperson Percy Maleta who was part of a team of local ASMs who showcased products at the International Expo in Beijing, China says as Malawian ASMs, they have learnt that through adequate government and private sector investment in the subsector, other countries have modernized ASMs operations.

“Our friends this side of the world have modernized their mining industry including their ASMs while we are stuck with pick and shovel. Malawi needs heavy investment in the ASMs in order to beat international marketing,” he says.

He explains that through the expo, local ASMs have learnt how business should be done to develop the ASMs subsector in Malawi, which is very young.

“Rubbing shoulders with experienced professionals in the sector was a big boost,” he says.

Maleta proposes that when opportunities arise for local ASMs to showcase at such high profile events, government should help them to secure pavilions by subsidizing costs just as governments of neighbouring countries do in order to enable their ASMs market their products at trade fairs and gemstones exhibitions.

He says: “Zambia is always represented by its ASMs at all major gemstone shows.”

“Zambian ASMs have over four pavilions at the biggest gemstone show in the world in Tucson, Arizona heavily supported by their government.”

“We hope Malawi government will be doing the same.”

Maleta says it is very unfortunate that Malawi has not been aggressive in promoting the ASM subsector as compared to its peers though the country is on the ladder as the next destination for gemstone suppliers owing to more discoveries of minerals that continue to be made.

He, therefore, says it is imperative for Malawi to use this discovery of various minerals to its advantage.

Maleta says: “For Malawi to improve as a country to ensure that our gemstones are competitive on the market and the ASMs subsector adequately contributes to the economy, there is a need for change across the board.”

“Government should seriously consider making ASMs licensing flexible so that we are able to get licenses in all mining hot spots”.

“This can also be done at district level unlike the set up now where a prospective miner has to travel all the way from Marka in Nsanje to Blantyre or Nthalire in Chitipa to Mzuzu just to pay a MK2000.00 for a prospecting license for the district.”

He says such centralization in issuing small-scale mining licenses is encouraging the citizenry to do illegal mining.

Maleta also urges government to invest in ASMs training in mining, value addition and marketing and clearly spell out ASMs subsector support in the national budget just as the case is with small scale agriculture where there are extension workers, lots of subsidies and support.

The Beljing Expo ran from September 15 to 30, and the cooperative was also expected to exhibit at another show in USA from September 5 to 12 under the sponsorship of Export Development Fund (EDF). However, the USA show has been rescheduled to February 1 to 8, 2020.

“We are very thankful to EDF and this is what we are looking forward to as ASMs. We ask other organization to emulate as it is through participating at these shows that we gain the exposure and strike deals,” he says.

In the USA, the cooperative will showcase Malawi gemstones in Tucson, Arizona and at Malawi Embassy in Washington DC.

Maleta says: “It is my wish that the Ministers, Principal Secretaries, and Directors of the following Ministries; Natural Resources, Energy and Mining: Industry, Trade and Tourism; Finance and Economic Planning; and Foreign Affairs and International Cooperation at least attend one gemstone show to really appreciate and understand what other countries that are excelling in the ASM subsector are doing.”

“Let them start with the biggest gemstone and mineral show in the world in Tucson Arizona next year in January or February. These decision makers need exposure just like the miners and we trust that this request reaches them in good faith.”

At the Beljing Expo, Maleta says the Cooperative met five prospective buyers of Malawi gemstones and other minerals and prospects are high that it will sign contracts with the buyers.

He, therefore, describes Nyasa’s attendance of the Expo as a success but says since marketing of Malawi gemstones and minerals is an ongoing exercise, the Cooperative will be attending all major international exhibitions.

Cement manufacturing giant LafargeHolcim Malawi has taken the market by storm with the launch of Instacrete Ready Mix Concrete, which is the first commercial ready mix concrete to be introduced on the Malawi market.

Lafarge CEO Albert Sigei said at the launching ceremony of the Ready Mix Concrete at the Company’s Central Region offices in Kanengo, Lilongwe, that the new product will simplify the building process for contractors making it faster, better and safer as compared to the man mixing process.

Sigei said; “Building solutions around the world have been evolving; and the same needs to happen in Malawi. As a country with one of the highest urbanization rates in the world, it is expected that the demand for infrastructure development will be high.”

“Building solutions that provide faster and higher quality materials for the development of that infrastructure are, therefore, critical at the current stage of our country’s development.”

Instacrete Ready Mix Concrete will be produced by InstaCrete Limited, a subsidiary of Lafarge.

Lafarge also launched a concrete laboratory that will support InstaCrete through provision of technical services by ensuring that the concrete mix designs are innovative and tailored for different building projects.

“This laboratory has the capability to develop concrete mix designs, test aggregates and provide technical expertise for major concrete structural work. The laboratory is open to all customers that may wish to use these services,” he said.

Lafarge’s Head of Marketing and New Solutions ChikondiNg’ombe, urged building contractors to start using Instacrete Ready Mix Concrete saying it is far much better than the man mix process which on some occasions has resulted in the collapse of the structures due to poor mixing.

“It is difficult to control quality using the man mixing process as some mixer’s overdose on some materials,” she said.

Lafarge has only introduced the new product in Central Region but Ng’ombe said the Company has planned to introduce the Concrete in Northern and Southern Regions since there is rising demand for the product which shows that the market is ready for it.

“We have a readily available market for the product and we have already started supplying to some major Lilongwe construction works including Area 18 interchange,” said Ng’ombe.

Formerly Portland Cement Company, LafargeHolcim Malawi has been a leading building solutions provider in Malawi for over 60 years providing innovative building solutions serving masons, builders, architects and engineers.

Lafarge’s cement brands include Supaset (CEMII 42.5R), Duracrete (CEMII 32.5N), Kumanga (MC 22.5X), and Khoma (MC5).

The Company also produces SupaLime (hydrated lime) and, according to Ng’ombe, other innovative products are in the pipeline.