The acute shortage of foreign exchange coupled with government’s interventions to prioritise critical imports such as fuel and fertiliser have robbed local importers of the forex they desperately need to import raw materials.

In its July 2023 edition of the Malawi Economic Monitor, the World Bank observed that government has protected critical imports such as fuel and fertiliser “through prioritised access to official financing”, leading to a severe contraction across all other major imports.

This development has exposed local businesses who are reportedly experiencing problems accessing forex from the local banks.

Zuwa Energy chief executive officer Jones Ntaukira, whose company imports solar panels and assorted products, said the forex shortage has prompted the company to reduce its annual imports.

He said the company could import a 40 feet container, which can carry about 50 800 kilogrammes of cargo every quarter, but has imported one 20-foot container since January 2023.

This means the company’s imports have dropped by about 75 percent since the turn of the year.

Said Ntaukira: “Sales have actually dropped. Our failure to import stock means failing to make sales resulting in the lowest performance of the first half in four years.”

In a separate interview, LM Aquaculture Limited managing director David Nkhwazi said because of forex shortages, they are failing to access raw materials to produce and export.

“The problem is the growing spread between the official exchange rate and the rate on parallel market. This means that we are selling our forex at lower price, but when we want to import, we have to pay the black market rate which is high,” he said.

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