In a bid to increase market access for its products Malawi has signed bilateral trade agreements with the following countries: - South Africa, Zimbabwe, Botswana, Mozambique and China. The following is a highlight of agreements.
The Malawi-South Africa Trade Agreement
The Malawi-South Africa Trade Agreement signed in 1990 is a non-reciprocal agreement whereby South Africa allows duty-free imports of all goods grown, produced or manufactured in Malawi, subject to a minimum value-added content of 25 per cent. Quotas apply to some products such as tea, which is limited to 10,000 tonnes annually. South Africa has erected many non-tariff measures to limit imports under this agreement. Malawi applies the MFN rate of duty on imports of South African goods. Some Malawian products require import permits to benefit from preferential treatment (e.g. 300 tonnes of manufactured tobacco, 750 tonnes of raw groundnuts and 100 tonnes of processed groundnuts).
The Malawi-Zimbabwe Free Trade Agreement
The bilateral trade agreement between Malawi and Zimbabwe was signed in 1995.It allows duty-free imports on a reciprocal basis between the two countries, provided the goods meet 25 per cent minimum domestic content provisions and conform to each other’s standards. Trade restrictions that are WTO-compliant are allowed. Malawi and Zimbabwe are both members of COMESA and SADC.
The Malawi-Botswana Trade Agreement
Malawi has maintained a customs union agreement with Botswana since 1956, which works on a de facto basis. All goods wholly obtained and manufactured in either country, with the exception of spirits, are traded on a reciprocally duty-free basis. Both countries are members of SADC.
The Malawi – Mozambique Trade Agreement
The liberalization will allow trade in goods originating from the two countries free of all customs duties - with the exception of goods on a list of "sensitive" products. These include beer, soft drinks of the Coca-Cola and Schweppes brand marks, tobacco, sugar, vegetable oil, chickens and eggs, office equipment, petroleum products, weapons, ammunition and explosives. The agreement also envisages safeguards to protect businesses of each country from any unfair competition.
The Malawi – China Trade and Industry Agreement
The most recent of Malawi’s bilateral trade agreements, signed in 2008, affords Malawian exports preferential access to China’s markets and provides incentives for Chinese INVESTMENT in Malawi.