Mining & Trade News

Malawi’s tea is making positive strides on the world market as the Caduceus Cellars, owned by winemaker Maynard James Keenan, a Grammy award-winning vocalist for Tool, A Perfect Circle, and Puscifer, will feature five hand-crafted Malawian teas at his Jerome, Arizona Tasting Room in USA on December 28, 2020.

The teas to be featured include; Masala Chai, Lost Malawi English Breakfast, Earl Grey, Green Tea and Mint, as well as Lemon Blend tea,  and it is curated and blended by the United Kingdom’s Rare Tea Company and grown by Malawi’s Satemwa Tea and Coffee Estate.

According to Jordan Price, Malawi’s Honorary Consul in Texas –USA, the beverages are to be incorporated having perfectly complimented Caduceus’ award winning wines.

Price said: “As an Ambassador, I am excited Arizonans and international visitors to the historic mining town of Jerome, will experience the passion and dedication of Malawians through these delicious teas.”

He also disclosed that the sale of these teas will help fund school scholarships through the Rare Tea Company’s nonprofit arm, Rare Charity.

Caduceus Cellars Tasting Room Manager Brian Sullivan thanked Jordan Price Malawi’s Honorary Consul, for providing an enthusiastic introduction to Malawi.

Sullivan said: “I was fascinated by the information Hon. Consul Price shared about Malawi and tea farming. Later I researched the country on the internet and learnt that Malawi was the first country in Africa to grow tea commercially. Pointing me in the direction of the Rare Tea Company has also been a positive experience. They have been quite professional in their interactions and I am looking forward to continuing working with them going forward.”

Founder of Rare Tea Company, Henrietta Lovell, said, “Everything you know about wine is true of tea. The effects of the terroir are every bit as crucial, as is the harvesting and the crafting.  Great tea comes from great producers, in the same way that fine wine does. We source the best to bring you the greatest flavors.”

Alexander Cathcart Kay, owner of Satemwa Tea and Coffee Estate noted that high value teas have a direct impact on Satemwa’s ability to sustain its vision of improving the living standards of their employees and neighboring farmers.

The teas available at Caduceus Tasting Room include black teas grown on the estate and Fair Trade Spearmint and Lemon Verbena, grown by adjacent independent farmers.

He said, “It is exciting and gratifying to see Satemwa specialty teas find their way into high quality establishments like Caduceus. Satemwa has struggled to make progress in the US market over the years and the support received from the Malawi Embassy, through their Honorary Consul and the commitment of the Rare Tea Company makes an enormous difference.”

Founded in 1923, Satemwa is a third generation family owned tea and coffee estate in Malawi’s Shire Highlands which contributes to improved Malawian standards of living by crafting a unique line up of white, green, oolong, black, dark, and herbal teas. 

Price fluctuations are the major setback to the advancement of pigeon pea farming in Malawi, a representative group of the crop’s farmers the Nandolo Farmers Association of Malawi (NFAM) has said.

Speaking in an exclusive interview with Mining and Trade Review, NFAM Chairperson Susan Chimbayo said that lack of profitable and reliable markets, insufficient finances and high interest rates are among the factors that derail the capacity of the crop to contribute enormously to the country’s economic growth.

Chimbayo explained that the marketing performance of the crop was greatly affected by import restriction cap set by the Indian government in 2018. With the cap in place, prices dropped to as low as MK30/kg until the Malawi government intervened, a development which saw prices rising to as high as MK230/kg in the 2019-2020 season.

 “Prices of pigeon peas from 2019 to 2020 have ranged from MK250 to MK365/kg. this has renewed farmers’ interest to grow the crop,” she said adding that the market condition has generated high demand on the market and thus makes prospects for 2021 lucrative.

She said farmers under the association benefit from a deliberate policy where registered members attract a premium of MK20-MK30 above market prices. “This means farmers under the association get better rewards compared to non-members.”

However, she said there is a need to put in place deliberate policies to encourage production of pigeon peas as well as protecting farmers from vendor exploitation through licensing and monitoring buyers.

“So far we are lobbying for an exporting quota to India so that Malawi can export raw and value-added pigeon peas as other countries like Tanzania and Mozambique do,” she said pointing out that the association and government can partner to promote value addition using processing plants which are currently lying idle across the country.

NFAM plans to establish a factory under Nandolo Trading Company. The company will be responsible for procurement and marketing of pigeon peas on behalf of farmers.

Chimbayo commended the market linkage the association has with Mozambique based Royal Group of Companies which has improved purchase prices of pigeon peas from MK50 to MK230.

The association is composed of pigeon pea growers aiming at achieving increased production as well as maximizing returns from pigeon pea production. It has about 10,682 members working in 33 member cooperatives in Southern Region of Malawi.

The Malawi Communications Regulatory Authority(MACRA) says there is need for thorough understanding by consumers on usage of mobile data in the fast paced digital era.

MACRA Deputy Director Thokozani Chimbe made this observation during a panel discussion the institution organised to address consumer concerns on mobile data user experience in the country.

Chimbe said:  “We have been receiving complaints from members of the general public over poor service quality of mobile data from the country’s mobile network providers.”

“In most scenarios, we established that there is information gap between consumers and service providers on how to efficiently utilize some of the mobile handsets among others tools and settings applied to minimize external applications from consuming data.”

She said MACRA will liaise with its technical and economic units to come up with necessary regulatory interventions to address the issue.

Digital Experience Manager at AIRTEL Michael Mang’anda said in its efforts to ensure Internet affordability by many Malawians, the company has recently slashed pay-as-go data pricing by 50% from K30 per megabyte to K15 per megabyte.

Internet remains unaffordable for a majority of Malawians, and studies reveal that even though there has been an improvement on Internet access, from 9.6% in 2016 to 13.1% in 2018, the Internet speed is slow as compared to the global average.

In 2015, the International Telecommunications Union (ITU) findings indicated that on average Malawians use more than $12 (about K8 760) a month on mobile phones, the primary means of accessing the Internet. The report indicated that [at the time] the $12 was more than half of what an ordinary Malawian earned in a month with the minimum wage standing at K15 000.

The latest Malawi Economic Monitor by the World Bank has faulted high taxation as one of the major factors behind exorbitant internet charges in the country.

The oil exploration and production subsector is considered as one of the industries with the potential to uplift Malawi’s economy. Mining & Trade Review’s Wahard Betha engaged Minister of Mining Rashid Gaffar to seek clarification on topical issues in the subsector. Excerpts:

1. There are concerns by some stakeholders on the size of Oil and Gas exploration blocks saying they are too big, and that they need to be re-demarcated. What is the government’s position?  Will you demarcate them?

Firstly, let me acknowledge that the Blocks are indeed big. However, this is the case because when the Blocks were being demarcated in 2009, the country did not have a substantial bank of data on the prospects of Oil and Gas. As a result of this, Malawi had to demarcate large Blocks which would help prospecting companies to study Geology of the country at large whilst trying to identify potential areas for Oil and Gas discovery.

Now that there has been exploration work going on with acquisition of some geological information and data, Government will consider re-demarcating the Blocks. You might also wish to know that during consultation meetings for review of Petroleum (Exploration and Production) Act of 1983, such issues were being raised and best international practices were being proposed by key stakeholders to be adopted in order to have sizable Blocks rather than what we currently have.

Should Government wish to re-demarcate the Blocks today, the process will only be applicable to the vacant Blocks and not those with active licences.

2. Following the relinquishment of oil and gas blocks 1 and 6, when should we expect the ministry to release advertisements of the blocks for investors to acquire the tenements?

You might be aware that the Ministry is working on revision and formulation of a number legal and regulatory frameworks. One of the key instruments is the Petroleum Exploration and Production Policy which had already gone through a number of review processes. It is the wish of Government to call for interested investors to make applications once the Policy is approved.

There are a number of issues that are outlined in the draft Policy designed to benefit local Malawians which Government is willing to implement. In this regard it is considered very important to wait for approval of the Policy which is expected to be done very soon then advertisement of the Blocks will be made.

3. I remember under the previous administration, there was an arrangement to review the Petroleum Sharing Agreement signed with Rak Gas because the existing agreement did not present a win-win situation between the investor and the nation. What is the position of the current administration? Are you going ahead with the review position?

It is the Government’s wish that all mining and petroleum contracts are anchored at the interests of Malawians at large. Re-negotiation of the signed Petroleum Sharing Agreement (PSA) started some years ago but it was put on hold pending finalisation of the draft model PSA. This was done so to ensure that the outcome of the re-negotiation should reflect the interests of Malawians as captured in the model PSA.

Currently, there is a draft model Petroleum Sharing Agreement (PSA) which the Ministry is working on with the Ministry of Justice and Constitutional Affairs to have it finalised. Once this is completed, Government will fast-track re-negotiation of all contracts that are deemed not properly signed.

4. There was also an arrangement to develop a standard petroleum sharing agreement for Malawi. How far have you gone with the process?

As alluded to in the above statement, there is a draft model PSA which was developed in consultation with the Ministry of Justice and Constitutional Affairs. There are also international development partners that are helping to review the draft model PSA to provide relevant expertise from international best practice perspective. Currently, the Ministry has planned a number of activities to have the model PSA finalised as soon as possible.

5. All in all, what is the position of the new government on oil exploration? Do you support oil exploration ventures?

The Tonse Government has total support for Oil and Gas exploration. As you are aware that currently, there is no any Oil and Gas discovery made. However, the sector has huge potential to boost economic status of the country if well managed when discovery of deposits of economic value is made. This is one of the sectors that many Malawians can be actively involved in their socio-economic activities ranging from businesses to employment.

Considering all economic benefits that the country can realise from the sector, Government is rendering all support it can in order to create an enabling environment for investment of both multinational Oil and Gas companies and local entrepreneurs.

6. Please provide any information you feel is important to enlighten Malawians on the reforms that government is undertaking in the upstream petroleum subsector. You may also provide any information that shades more light on the issue of oil prospecting in Malawi.

In preparation for the future Oil and Gas discoveries, Government is in support of the major reform areas in the sector. These include review of the Petroleum (Exploration and Production) Act of 1983, formulation of the Petroleum Exploration and Production Policy, formulation of model PSA and review of relevant laws such as Taxation Act to create a conducive environment for investors whilst ensuring maximum benefits to Malawians.

Malawians may also wish to note that the companies that have been operating in the country have been reporting good progress in terms of the Geology of the country in relation to Oil and Gas occurrence. There are target areas with high potentials which have been identified for further studies. Such developments are giving hope in search for Oil and Gas from the time the country did not have such information and data to present. Government is willing to support the investors until such a time breakthrough is achieved in the upstream petroleum sector.

Let all Malawians be assured that the Ministry is striving hard to have up to date legal and regulatory frameworks which aim at ensuring that Malawians are involved in the Oil and Gas cycle and they are benefiting from activities happening in the sector.

Malawi is advancing with preparations to become part of the Africa Continental Free Trade Area (AfCTA) after President Dr. Lazarus Chakwera signed and ratified the AfCFTA instruments on November 1, 2020, which government is now working on depositing with the AU.

The approval of instruments required to operationalize the AfCTA are expected to be signed off by African governments by January 2021 to show their commitment to the trade arrangement.

The AfCFTA is one of Africa’s reform efforts upon realizing trade imbalances with other continents and the subsequent economic loss suffered since the colonization era.

According to Minister of Trade, Sosten Gwengwe, the AfCFTA reinforces the dreams of the founding fathers of the African Union to see a united and more integrated Africa that would ensure that African wealth remains in Africa to benefit the African population.

Among the instruments required to operationalise the AfCFTA include: Rules of Origin that entails laws, regulations and administrative rulings applied by governments to determine the country of origin of goods, services or investments and whether they qualify for a preferential tariff regime.

Through the arrangement, tariff offers shall be applied to scheduled products and time frames within which a country can liberalise its trade in the free trade arrangement. To date, 41 countries and customs unions, including Malawi have submitted their tariff offers.

Gwengwe disclosed that Malawi submitted its initial offer covering 90% tariff liberalisation in November 2019 and the final offer is now ready after being validated by stakeholders, led by the Malawi Confederation Chambers of Commerce and Industries (MCCCI), on November 21, 2020.

“All strategic products and sectors have been designated either under sensitive or excluded list for purposes of liberalization,” said the Minister explaining that the country is at an advanced stage in preparing the National schedule of specific commitments and is expected to submit it before January 1, 2021.

Gwengwe said that another advantage of the AfCFTA is its role to eliminate Non-Tariff Barriers (NTBs) as a way of enhancing and facilitating intra Africa trade.

“The AfCFTA mechanism will facilitate reporting, monitoring and negotiating of the removal of NTBs across regions and the continent as a whole. This facility will provide real time communication on the existence and types of NTBs among all parties to reduce time and cost of cross border trade,” Gwengwe said.

He added; “Although our product offering is primarily classified under sensitive and/or excluded, we still have access to a wider market than before especially to the North, West and Central parts of the continent.”

The minister further disclosed that Malawi will soon launch the National Export Strategy II that will encourage private sector develop competitiveness in niche areas where Malawi can have comparative advantage.

Gwengwe said his ministry, with the help of the United Nations Economic Commission for Africa (UNECA), have formulated a strategy on National Implementation of the AfCFTA to mitigate against any challenges that may arise out of the operation of the trade agreement.

On November 1, 2020, President Dr Lazarus Chakwera signed and ratified the AfCFTA instruments, which government is now working on depositing with the AU.

A total of 54 out of 55 countries have signed the agreement with exception of Eretria. 34 countries have since ratified the agreement.

The AfCFTA is expected to bring together 55 African countries with a combined population of 1.2 billion people including a growing middle class and combined GDP of more than US$3.4 trillion.

The Ministry of Transport and Public Works has committed to work hand in hand with investors on the construction of an international airport in the lakeshore district of Mangochi in a public private partnership (PPP) arrangement.

Andrew Nthiko, the spokesperson for the ministry, says government is prioritizing the project because it recognizes the impact of a lakeshore airport on the country’s tourism.

“As government, we are very committed to help the investors since the proposed project is crucial not only to Malawi but also to the region,” Nthiko said explaining that among others, government will guide the investors on the best construction site, standards and designation of types of planes to land or leave the airport.

As the Africa Continental Free Trade Area (AfCFTA) comes into effect on January 1, 2021, the airport is expected to be useful in the transfer of people, goods and services across the continent and especially among Southern Africa Development Community (SADC0 member states.

Meanwhile, an interested investor and developer, Cape Maclear Holdings, has asked government to fast track the PPP tender process so that the project starts.

Malawi has two international airports, Kamuzu in Lilongwe and Chileka in Blantyre.

Government also plans to construct an international airport in Mzuzu.

Malawi’s Roads Authority (RA) is inviting eligible consultants to supervise the rehabilitation and widening of four sections of the M1 road between capital city Lilongwe and Northern Region town of Karonga.

The project will, which will involve the rehabilitation of a total of 301km of the M1 road, will be financed using proceeds of a loan from the European Investment Bank (EIB) and a grant from the European Union (EU) under the Africa Investment Facility.

The four targeted sections include; from the turn off to the Kamuzu international airport to kasungu (102 km); from Kasungu to Jenda (85.5 km); from Jenda to Mzimba turn off (46.74 km) ; and Kacheche to Chiweta (66.5 km).

The works will include the widening of carriageways, construction of shoulders, reconstruction of the pavement, widening of bridges and implementation of road safety interventions.

“The primary objective of the consultancy services is to simultaneously carry out the supervision of the rehabilitation and widening works on all four sections of the works including technical and financial supervision, contract management and to ensure that the works are carried out in accordance with the respective contract specifications and to the satisfaction of the implementing agency,” says RA in a statement.

It states that each section will have a defects liability period of 12 months during which limited input will be required by the consultant.

The contract for the provision of the consultancy services is expected to start not earlier than May 1, 2021 with an estimated total duration of 44 months (inception phase of 2 months, construction period of 30 months and defects notification of 12 months).

RA says the invitation for expressions of interest is open to all firms and joint ventures from all countries, and shall be followed by the production of short-listed consulting firms.

“The short-listed firms will be formally invited to submit technical and financial proposals, which shall be evaluated. Award of the contract shall be made on the basis of the most economically advantageous tender (MEAT),” states RA.

Traders in Personal Protective Equipment (PPEs) have bemoaned low sales following continued drop in the number of coronavirus (Covid-19) cases in Malawi, which has prompted many Malawians to stop using PPEs.

Anthony Chiputula who sells face masks in Lilongwe city complained in an interview that since government started announcing a drop in number of Covid-19 infections in its updates, his business has nosedived.

“The decline in number of local Covid-19 cases has greatly affected my business, as only few individuals are interested to buy and use face masks,” said Chiputula

Esther Botolo who sells hand sanitizers in the same city concurred with Chiputula that the number of customers who visit her shop to buy hand sanitizer has gone down. She attributed the decline to the decline in Covid-19 infections which has made people to relax in the fight against the global pandemic.

“The business of selling hand sanitizers is no longer attractive as was the case at the time Covid-19 cases were high,” he said.

Adam Taulo, a tailor in face masks business also complained that his business has drastically gone down. He explained that he usually had huge orders at the time Covid-19 cases were high, which he said is not the case currently.

“My business is struggling a lot, because people no longer place huge orders for face masks. I know this is happening because most of people have stopped adhering to Covid-19 preventative measures,” lamented Taulo.

Meanwhile ministry of Health has asked all Malawians to continue adhering to all Covid-19 preventative measures, saying there is a possibility that the country may experience a second wave of the pandemic as is the case in other countries.

Minister of Agriculture Lobin Lowe has hailed Civil Society Agriculture Network (CISANET) for its meaningful contributions in developing the agricultural sector in the country.

Lowe made the remarks at Bingu International Convention Centre during the Agriculture Open Day organised by CISANET under the theme ‘Making Agriculture Work in Malawi.’

He said he was impressed with various programs and activities that the organisation holds saying their strategic priorities and the thematic areas align with those of the Ministry.

Lowe said: “I am happy to note that CISANET is already a reliable strategic partner that my Ministry continues to work with.”

“I appreciate CISANET’s efforts that aim at coordinating and fostering collaboration among non-state actors towards agricultural transformation.”

“Indeed as the CISANET slogan suggests ‘together we can make agriculture in Malawi vibrant’.”

He also advised all stakeholders in the sector to consider stocking themselves to see if they are making progress in the industry.

Lowe said continued monitoring and evaluation will help the player to gauge how far or close they are towards their intended destination in the sector.

He said it is of paramount importance to devise ways of getting to the top that every farmer in the country has been dreaming to so that their lives can be improved.

The minister also expressed acknowledgement on the challenges that are currently being faced in the sector and said it high time as a country we should start asking ourselves on what we do to promote food security.  

He said: “I do agree with CISANET that at the core of these challenges are the following questions: How do we increase access to markets for farmers? And how do we strengthen the resilience of the sector to weather and market shocks?”

“I would like to assure you that Government is aware of all these challenges, and working really hard to respond to them. As Government we are committed to respond to these challenges through sufficient budget allocations and policy implementation.”

Lowe urged civil society organisations in the country to continue collaborating with the government and also come forward to bring recommendations to government based on their work or experience from expatriates.

In her remarks, CISANET National Director Pamela Kuwali said she was delighted with the Minister’s openness to recommendations from the CSOs.

Kuwali said: “After meeting the minister we are very happy, especially this is not the first time we have met him. We have noted that every time we have been in his office he has been open. Each time we invite him to our events he shows up.

“We understand that the role of revamping the agriculture sector is not a one body duty. So his openness shows that he really cares for the sector.”

She also said holding of more agricultural events in country can help that policies are not only on paper but also on the ground.

Kuwali said the country needs to be harnessing the benefits from every project that it kick starts rather than being masters in paper work.

She said as CSOs working in agriculture they will continue pushing the government to consider revising the calendar on commencement of buying farm produces.

Kuwali said the country has the tendency of opening ADMARC doors very late, a practice that forces the farmers to be selling their products to unlicensed vendors.

Meanwhile, under Affordable Inputs Program (AIP) the Ministry of Agriculture has managed to sell a total of 165,784.40 Metric Tonnes (MT) of fertilizer representing 45%, translating to 1,657,844 farming household accessing fertilizer.

The Government has also sold seeds amounting to 8,744.44 MT representing 44%.