Malawi - Market ChallengesMalawi - Market Challenges
- High transport costs due to Malawi's landlocked position. Transport costs can constitute more than 30% of the country's total import and export bill.
- Unreliable power and water supplies. Approximately 10% of Malawians have access to electricity (5% in rural areas and 46% in urban areas).
- Lack of skilled and semi-skilled labor.
- High lending rates averaging around 27% make it expensive to access capital on the local market.
- Political risk; administrative and regulatory uncertainty. The Government of Malawi has often made dramatic changes to key policies and regulations, frequently affecting businesses’ profitability.
- Corruption – lack of conflict of interest rules and non-transparent procurement procedures often disadvantage U.S. companies bidding on government tenders.
- Longstanding commercial relationships with South Africa, Malawi's primary supplier of imported goods. Although U.S. products are respected, a lack of historical business ties between the United States and Malawi, together with comparatively high product and transport costs, disadvantages U.S. suppliers.