UNLOCKING MALAWI’S POTENTIAL AS A REGIONAL TRADING HUB
8.1 Overview
Trade is the lifeblood of any growing economy, and for Malawi, the path to becoming a regional economic powerhouse runs through strategic investments in trade infrastructure, predictable policies, value addition, and services. Building on agriculture, energy, industrialization, tourism, and mining, UTM’s vision for trade aims to position Malawi as a vibrant center for regional and international commerce.Challenges facing trade in Malawi include:

• Complacent and directionless leadership that burdens the private sector with blame, high taxes, while failing to cultivate a thriving environment for trade and industrial development.
• Geographic Limitations and Infrastructure Deficits: Malawi’s landlocked position necessitates reliance on neighboring countries for port access, increasing
  transportation costs and transit times. Poor road, rail, and storage infrastructure further reduce the competitiveness of Malawian goods in export markets.
• Overreliance on Few Commodities: Heavy dependence on agricultural exports like tobacco, tea, and sugar exposes Malawi to price volatility, climate shocks, and market shifts, leaving the economy vulnerable
• Trade Barriers and Inefficiencies: Lengthy border crossing times, inefficient
• customs processes, and restrictive licensing requirements create bottlenecks
• for trade flows. Progress on One-Stop Border Posts (OSBPs) has been slow and uneven.
• Underdeveloped Value Chains: The lack of local processing industries for agricultural and mineral raw materials results in lost opportunities for economic diversification, job creation, and higher export revenues.
• Unstable Policy Environment: Frequent changes in trade policies—such as sudden export bans—undermine investor confidence and harm Malawi’s reputation as a reliable trade partner.
• Limited Market Access for Smallholder Farmers: Smallholder farmers face such as inadequate transportation, lack of storage facilities, and price volatility, keeping them disconnected from markets and limiting their profitability.
• Underutilized Services Sector: The services sector, including tourism, financial services, ICT, and logistics, remains underdeveloped, limiting its contribution to trade and economic growth. Aligned with MW2063’s pillars of Industrialization, Economic Resilience, and Inclusive Wealth Creation, and leveraging enablers such as Private Sector Dynamism,Urbanization, Technology Adoption, and Governance, UTM’s trade strategy will address these challenges, unlocking Malawi’s potential as a regional trading hub.

8.2 UTM’s Strategic Pledges for Transforming Trade
Alignment with MW2063: UTM’s trade strategy aims to establish Malawi as a
leading trading block in the region by modernizing trade infrastructure, promoting value addition, and empowering local communities.Target Milestone: UTM aims to position Malawi as a leading trading hub in the
region, with trade—including services—contributing up to 50% of Malawi’s GDP by 2035.
8.2.1 Stable and Predictable Trade Policies
Alignment with MW2063: Enhances Governance and Private Sector Dynamism by providing clarity and stability to investors and traders.
UTM Pledges:

• End arbitrary export bans and replace them with clear, transparent, and consistent trade policies aligned with regional and international agreements (SADC, COMESA, WTO).
• Guarantee policy predictability to encourage local and foreign investment in trade-related sectors
• 8.2.2 A Robust National Commodities Exchange
• Alignment with MW2063: Promotes Inclusive Wealth Creation and Economic
• Resilience by empowering producers and ensuring fair trade practices

UTM Pledges:

• Establish regional offices for the commodities exchange to decentralize access for smallholder farmers and traders.
• Diversify commodities beyond tobacco to include maize, soya, legumes, and other high-demand crops.
• Provide real-time market information and price transparency to ensure fair value for producers and buyers.

8.2.3 Scaling Up One Village One Product (OVOP) to One District One Product (ODOP) Alignment with MW2063: Strengthens Economic Resilience and Private Sector Dynamism by promoting localized industrialization and exports.
UTM Pledges:

• Develop OVOP and ODOP into major export drivers, leveraging traditional crafts, agro- processed products, and innovations unique to Malawi’s villages.
• With the Private Sector, establish a nationwide cooperative-based shopping chain modeled after COOP in Italy to link local producers to urban and regional markets.
• Promote Malawi globally as a Fair Trade Market to attract conscious buyers.

8.2.4 Leveraging Mega Farms for Export and Industrial Supply
Alignment with MW2063: Supports Agricultural Productivity and Industrialization by ensuring consistent supply for trade and manufacturing.
UTM Pledges:

• Position mega farms as reliable sources of raw materials for agro-industries and export markets.
• Focus on high-value crops like macadamia, soya, coffee, and specialty fruits to diversify export earnings. 
• 8.2.5 Infrastructure Modernization and Logistics Reform
• Alignment with MW2063: Advances Urbanization and Economic Resilience by reducing trade costs and improving connectivity.

UTM Pledges:

• Modernize road, rail, and port infrastructure to reduce trade costs and improve market connectivity.
• Expedite the rollout of OSBPs at key border crossings to reduce delays.
• Invest in cold storage facilities to expand Malawi’s ability to export fresh produce.

8.2.6 Promoting Value Addition
Alignment with MW2063: Boosts Industrialization and Economic Resilience by transforming raw materials into finished goods.
UTM Pledges:

• Establish agro-processing zones and industrial parks to transform raw materials into finished products.
• Provide tax incentives for industries focused on export-oriented production.
• Encourage local entrepreneurs to explore niche products for international markets.
  8.2.7 Empowering Smallholder Farmers for Trade
  Alignment with MW2063: Promotes Inclusive Wealth Creation by integrating smallholders into value chains.
  UTM Pledges:
• Connect smallholder farmers to markets through cooperatives, mega farms, and contract farming models.
• Create a credit facility for smallholders to access affordable loans for equipment, seeds, and transportation.
• Provide training in market dynamics, crop quality standards, and storage techniques.

8.2.8 Enhancing the Services Sector in Trade
Alignment with MW2063: Advances Economic Resilience and Private Sector Dynamism by prioritizing service exports.
UTM Pledges:

• Expand the tourism sector’s role in trade by marketing Malawi as a high-value destination.
• Develop ICT infrastructure to facilitate e-commerce and digital trade.
• Strengthen financial services to promote cross-border transactions and attract investments.
• Promote education and healthcare services as exportable sectors through targeted international partnerships.
  8.2.9 Regional Bi-Annual Trade Fairs
  Alignment with MW2063: Enhances Private Sector Dynamism and Economic Resilience by promoting business exposure and regional integration.
• UTM Pledges:
• Organize bi-annual trade fairs to showcase Malawian products and services to regional and international markets.
• Provide platforms for local businesses to network with foreign investors and explore export opportunities.
• Incorporate sector-specific expos, including agriculture, manufacturing, ICT, and tourism, to drive targeted trade partnerships.

8.2.10 Strengthening the Malawi Stock Exchange (MSE)
Alignment with MW2063: Enhances Private Sector Dynamism by fostering a vibrant financial market for capital mobilization.
UTM Pledges:

• Expand the MSE as a platform for local and regional investors to trade equities, bonds, and other securities.
• Require most mining companies operating in Malawi to list on the MSE, ensuring Malawians share in resource-based wealth.
• Encourage the Public Private Pension Investment Corporation (PPPIC) to trade on the MSE into safe long term ventures
• List the Dziko Bond for local investor participation
• Introduce an SME listings initiatives within the main MSE, by reducing listing fees and simplifying regulatory requirements.
• Conduct nationwide campaigns to educate Malawians on stock market benefits.
• Collaborate with regional exchanges for cross-border listings and foreign investment.

 8.3 The Vision: Malawi as a Regional Trading Hub
 A Center for Regional and International Trade
 Alignment with MW2063: Advances Economic Resilience and     Industrialization by modernizing trade and empowering communities.
Vision Highlights:

• Modernized trade infrastructure connecting Malawi to regional and global markets.
• A diversified export basket focused on value-added products and services.
• Empowered communities benefiting directly from trade-driven growth.