Manufacturing and Industrialization in Malawi: Trends, Opportunities, and Strategies

Key Messages: •Invest in increased agricultural productivity to raise incomes and increase domestic demand for manufactured products. •Develop a coordinated industrialization policy that covers key sectors of the economy including agriculture, mining, energy, labor, finance, and trade. •Invest in physical infrastructure (feeder roads, railways, electricity, and information and communication technology) to reduce the cost of doing business. •Cluster strategic industries (industries with high comparative advantage, potential for forward and backward linkages, and high content of domestic raw materials) into special economic zones for effective infrastructure and other services targeting. •Establish a well-funded industrial and agricultural research and development (R&D) system. •Maintain stable macroeconomic environment for increased private sector investments, reduced cost of borrowing, and to boost foreign direct investment inflows. •Invest in human resource development for improved technical skillsets necessary for more specialized forms of production. •Develop a forward-thinking strategy to tap into the expanded regional markets and engage regional value chains in subsectors where Malawi has comparative advantage. •Develop and implement a comprehensive anti-corruption strategy that should include a demonstration of credible intent to fight corruption, increased anti-corruption campaigns, and strict enforcement of laws.