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Prospects
for Malawi's External Trade Performance
Market
Report Forthnight ending 08th August 2003 Report
15/03
The
Fifth Ministerial Conference of the World Trade
Organization (WTO) members will be held from
September 10 to 14, 2003 in Mexico with a view
to take stock of the progress on the current
round of talks and other work under the Doha
Development Agenda. Among many things, the conference
is expected to come up with a practical approach
for leveling the playing field in international
trade competition. The presence of farm subsidies,
tariff and non-tariff barriers in some industrial
countries has made it very difficult for poor
countries like Malawi to penetrate world markets.
This has witnessed dismal performance of the
country’s external trade, which has been
dominated by huge trade deficits. More...
Economic
Implications of the 2003/2004 Financial Year Central
Government Budget
Market
Report Forthnight ending 25th July 2003 Report
14/03
The
Minister of Finance presented the 2003/04 Budget
Statement for deliberation by parliament on
Friday, 4thJuly 2003. The theme of this budget
statement is “Macroeconomic Stability:
A precondition For Economic Growth and Poverty
Reduction in Malawi. This comes at a time when
Malawi is experiencing subdued economic performance
due to several factors including poor performance
of the private sector due to high costs of financial
resources and lack of budgetary support from
the donor community. More...
Foreign
Exchange Reserves
Market
Report Forthnight ending 09th May 2003 Report
09/03
The
market is currently experiencing a shortage
of foreign exchange as a result of a sluggish
build up of foreign exchange reserves. Latest
numbers indicate that the economy's foreign
exchange position has actually been deteriorating
when the reserves at the close of April 2003
declined compared to the reserves position recorded
at the close of March 2003. This year's outturn
is in sharp contrast to what transpired during
a corresponding period in 2002 when the country's
foreign exchange reserves position was rising
and adequate enough to meet an equivalent of
four months of imports.More...
Tobacco
Sales and Long Term Prospects for the Malawi Economy
Market
Report Forthnight ending 25th April 2003 Report
08/03
The
state president officially opened the 2003 tobacco-marketing
season on 15th April 2003 at the Limbe Auction
Floors. Actual sales at the Limbe and Lilongwe
auction floors, respectively, started on the
10th and 11th March 2003 while the Mzuzu Auction
Floors opened its doors on 23rd April 2003,
over a month late than the other floors due
to inadequate supply of the leaf.More...
Fiscal
Sector Performance
Market
Report Forthnight ending 11th April 2003 Report
07/03
The
fiscal sector continued to register budgetary
operations imbalances attributable to low levels
of revenues in an environment of high expenditures.
Latest numbers released by the Monetary Policy
Committee (MPC) indicate that the cash budget
deficit worsened to K4,718.9 million in January
2003 from K4,153.1 million registered at the
close of December 2002. More...
The
Malawi Kwacha Exchange Rate
Market
Report Forthnight ending 28th March 2003 Report
06/03
The
opening of the tobacco season a fortnight ago
is yet to improve the foreign exchange situation
in the economy. An improvement in the forex
position could dumpen the pressure on the exchange
rate as it could reduce speculation tendencies
that play a role in determining the direction
of the exchange rate. This being the case, the
Kwacha is currently depreciating against the
USD.More...
Foreign
Exchange Reservers
Market
Report Forthnight ending 14th March 2003 Report
05/03
The
economy is experiencing shortages of foreign
exchange attributable to rising demand in an
environment of dwindling supply. Latest numbers
indicate that official reserves had by the close
of February 2003 declined to a low of US$129.10
million; representing an import cover of two
months.More...
Economic
Review: 2002 vs 2001
Market
Report Forthnight ending 24th January 2003 Report
01/03
The
performance of the Malawi economy was below
expectations during 2002 when compared to 2001.
Recent figures indicate that the slow down in
economic activities intensified during 2002
when real GDP contracted by 1.8% compared to
a decline of 1.5% registered in 2001.The dismal
performance of the whole economy, to a larger
extent, reflected developments in the fiscal
and external sectors, which inevitably crippled
the performance of the production sector.More...
Foreign
Exchange Reserves
Market
Report Forthnight ending 06th December 2002
Report 24/02
The
official foreign exchange situation soared when
the closing position for November 2002 stood
at US$131.93 million, representing 2.21 months
of import cover. This is, however, a seasonal
trend in the foreign exchange market. During
this time of the year, the demand for forex
increases as businesses import in preparation
for the approaching festive season while the
supply of foreign exchange slows down as the
economy passes through its forex lean period.
However, the situation has this year been execarbated
by the increased FX requirements for importation
of maize and the withholding of aid by the donor
community, which has inevitably effected the
economy’s traditional supply of foreign
exchange, more especially during this lean period.More...
The
Extended Surtax Scheme
Market
Report Forthnight ending 27th November 2002
Report 23/02
The
Malawi Revenue Authority with effect from 1st
November 2002 extended its surtax to wholesale
and retail level. This is one of the reforms
Malawi is undertaking with a view to contain
persistent macroeconomic instability, which
has on several occasions frustrated efforts
to bring about sound economic growth. More...
Foreign
Exchange Reserves
Market
Report Fortnight ending 30th August, 2002 Report
17/02
The
fortnight under review witnessed a marginal
draw down on official foreign exchange reserves
when the position dropped to US$207.067 million
(or 3.47 months of import cover) from this year’s
highest level of US$209.521 million (or 3.51
months of import cover). This reflects a rise
in demand for foreign exchange in an environment
of dwindling supply, which has coincided with
the closure of the tobacco-marketing season.
So far, the Limbe Auction Floor has already
closed with Lilongwe and Mzuzu Floors pending
to close around 6th September 2002. More...
The
Stock Market
Market
Report Fortnight ending 23rd August, 2002 Report
16/02
The
number of listed companies on the Malawi Stock
Exchange (MSE) has increased to nine with the
coming in of Sunbird Tourism Limited on Monday
12th August 2002. The listing follows the company’s
offer for sale of 39,237,400 shares. On the
first day of trading, 98,000 shares changed
hands at MWK 1.90 per share up by MWK 0.05 from
the pre-listing offer price of MWK 1.85 per
share. This saw the Malawi All Share Index move
up to 362.99 from 362.98 registered at the close
of business on Friday, 9th August 2002. More...
The
RBM Interest Rate Adjustment
Market
Report Fortnight ending 2nd August, 2002 Report
15/02
The
Reserve Bank of Malawi with effect from July
29 reduced its Bank Rate from 46.8% to 43%.
This should be seen as a deliberate move to
influence downward adjustments in interest rates
in the economy and is in line with the objectives
of the recently passed 2002/3 fiscal budget.
More...
Financial
Markets and Interest Rates
Market
Report Fortnight ending 21st June, 2002 Report
12/02
The
market is experiencing a liquidity squeeze attributable
to the tight monetary policy stance being pursued
by the monetary authorities. This has seen a
contraction on the demand for Treasury Bills
and has consequently forced the Treasury to
rely more heavily on overdrafts from the central
bank for its perennial cash shortfalls. More...
Fiscal
Sector Performance
Market
Report Fortnight ending 7th June, 2002 Report
11/02
Parliament
has this week started deliberating on the 2002/3
fiscal budget against a backdrop of severe fiscal
budget imbalances. According to latest statistics
the pressure on budgetary operations intensified
during the month of March 2002 when the deficit
increased to MWK2,759 million, representing
a monthly growth of almost 40% when compared
to a deficit of MWK1,957.1 million recorded
in February 2002. More...
Foreign
Exchange Reserves
Market
Report Fortnight ending 24th May, 2002 Report
10/02
The
performance of the external sector has been
comparatively sluggish against a corresponding
period in 2001. The official Foreign Exchange
position is currently at around US$165.0 million,
representing 2.7 months of import cover in sharp
contrast to an equivalent of 5.6 months of imports
recorded in May 2001. This position is a concern
because the economy always experiences a peak
in its foreign exchange levels during this time
of the year, due to tobacco sales. More...
Tobacco
Sales and Prospects
Market
Analysis Report Fortnight ending April 12, 2002,
Report 07/02
The
improved quality and presentation of this season's
tobacco crop at the auction floors indicates
a short and medium term easing of pressure on
the Malawi economy. Tobacco sales opened on
3rd and 4th April at the Lilongwe and Limbe
Auction Floors, respectively, where for the
first time in three years, Burley tobacco fetched
an average of US$1.60 per kilogramme. The average
price per kilogramme during 2001 was US$1.09.
More...
Poverty
Reduction and Growth Facility (PRGF) Programme
Market
Analysis Report Fortnight ending March 1, 2002,
Report 05/02
The
Malawi government and the IMF are this week
holding a series of meetings centred on reviewing
the country's performance on the current PRGF
programme. Malawi has for the past 22 years
gone through Structural Adjustment Programmes
(SAP), which were replaced in 2000 by the PRGF
programme. The SAP was initiated as a rescue
package from the crippling external effects
caused by the surge in oil prices, high interest
rates and the civil conflict in Mozambique,
that paralyzed the economy during the early
1970's. More...
Macro-Economic
Developments
Market
Analysis Report Fortnight ending February 15,
2002, Report 04/02
The
difficulty for the economy to develop built-in
mechanisms and the cost of its failure to cushion
itself against adverse exogenous forces manifested
when the MKW finally succumbed to the pressure
on the foreign exchange market. The MKW surprised
policy makers and the business community alike
when its average official exchange rate suddenly
plummeted to MKW72.28 to the USD, MKW1.34 to
the ZWD and MKW6.58 to the ZAR from MKW68.00,
MKW1.26 and MKW6.14 registered barely a fortnight
ago. To compound this situation, the fundamental
reality paints a gloomy picture for the immediate
term as the severe shortage of foreign exchange
has seen forex bureaux pegging one USD to as
high as MKW80. More...
Foreign
Exchange Reserves
Market
Analysis Report Fortnight ending February 1,
2002, Report 03/02
The
economy is experiencing a noticeable drawdown
on its foreign exchange reserves with the position
at the close of 2001 reduced to an equivalent
of MKW13.66 billion, representing 4.2 months
of imports. Whereas at a comparative month for
2000 gross reserves amounted to MKW19.46 billion,
an equivalent of 4.7 months of imports and barely
four months ago the reserves reached a high
of MKW23.83 billion, representing 5.8 months
of import cover. This position is mainly a result
of a rise in the demand for foreign exchange
during November and December against a reduction
in supply. More...
Fiscal Sector
Performance
Market
Report Fortnight ending January 18, 2002, Report
02/02
The
sector is currently experiencing severe imbalances
in its budgetary operations. The deficit in
November 2001 stood at K1.84 billion, after
recording a historical high of K1.88 billion
in the previous month. This outcome is to a
large extent attributable to a reduction in
revenues and a lower turn out of pledged foreign
aid in an environment of high government expenditure.
Revenues in November contracted to K2.72 billion
from K3.25 billion during October, representing
a monthly decline of 16.5 percent. On the other
hand, expenditures at K4.56 billion had only
declined by 11.0 percent when compared to K5.13
billion registered in October 2001. The bulk
of government expenditure emanated from domestic
debt service in form of maturing treasury bills.
More...
EXCHANGE
RATES, 16th February, 2001 Report 03/01
The current developments with local exchange
rates provide a glimmer of hope for Malawi's
volatile currency. The currency that has persistently
been weakening against its major trading partners
vis-à-vis the US Dollar (USD), South
African Rand (ZAR) and the Zimbabwe Dollar (ZWD)
seems to be gradually overcoming the pressures
of the same. More....
Blantyre,
2nd February, 2001 Report 02/01
The Money Market has faced significantly higher
interest rates in the New Year. Within the first
weeks the Reserve Bank of Malawi's Bank rate
recorded a high of 61.29%. This resulted in
some of the country's commercial banks raising
their base lending rates to as high as 62%.
On the inter-bank market scene (where banks
borrow from/lend to each other) the rates also
shot up by over 20 percentage points to an average
of 55%. More...
Blantyre,
12th January, 2001 Report 01/01
Mitigating the effects of the failed forex inflows
due to poor tobacco sales, Malawi has been blessed
with the granting of fresh loans alongside the
relief of debt it contracted sometime back.
More...
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