Economy of Malawi - Agriculture

Agriculture

See also: Tobacco industry

Agriculture represents 37% of GDP, accounts for over 80% of the labor force, and represents about 80% of all exports. Its most important export crop is tobacco, which accounts for about 70% of export revenues. In 2000 the country was the tenth largest producer in the world (See table). The United Nations Food and Agriculture Organization estimates the following production of unprocessed tobacco by country in 2009 (figures are in thousands of tonnes.)

Country Production in thousands of tonnes
China 3,067.9
Brazil 863
India 620
United States 373.1
Malawi 208.1
Indonesia 181.3
Argentina 135.5
Italy 119.1
Pakistan 105
Zimbabwe 96.3

The country's heavy reliance on tobacco places a heavy burden on the economy as world prices decline and the international community increases pressure to limit tobacco production. Malawi's dependence on tobacco is growing, with the product jumping from 53% to 70% of export revenues between 2007 and 2008.

The country also relies heavily on tea, sugarcane and coffee, with these three plus tobacco making up more than 90% of Malawi's export revenue. Tea was first introduced in 1878. Most of it is grown in Mulanje and Thyolo. Other crops include cotton, corn, potatoes, sorghum, cattle and goats. Tobacco and sugar processing are notable secondary industries.

Traditionally Malawi has been self-sufficient in its staple food, maize (corn), and during the 1980s it exported substantial quantities to its drought-stricken neighbors. Nearly 90% of the population engages in subsistence farming. Smallholder farmers produce a variety of crops, including maize, beans, rice, cassava, tobacco, and groundnuts (peanuts). Financial wealth is generally concentrated in the hands of a small elite. Malawi's manufacturing industries are situated around the city of Blantyre.

Malawi has few exploitable mineral resources. Malawi's economic reliance on the export of agricultural commodities renders it particularly vulnerable to external shocks such as declining terms of trade and drought. High transport costs, which can comprise over 30% of its total import bill, constitute a serious impediment to economic development and trade. Malawi must import all its fuel products. Other challenges include a paucity of skilled labor, difficulty in obtaining expatriate employment permits, bureaucratic red tape, corruption, and inadequate and deteriorating road, electricity, water, and telecommunications infrastructure which hinder economic development in Malawi. However, recent government initiatives targeting improvements in the road infrastructure, together with private sector participation in railroad and telecommunications, have begun to render the investment environment more attractive.

The following are Malawi's top 20 agricultural production values and volumes for 2009. (Unofficial figures derived from FAO statistics)

Commodity Production in International dollars (1000) Production in tonnes FAO source
Maize 462,330 3,582,500
Casava 404,764 3,823,240
Tobacco 331,542 208,155
Groundnuts 116,638 275,176
Bananas (Excluding Plantains) 95,152 400,000 F
Sugar Cane 82,093 2,500,000 F
Indigenous Cattle Meat 80,688 0
Pigeon Peas 80,274 184,156
Beans, Dry 75,706 164,712
Fresh Fruit 74,456 213,321 Im
Plantains 72,634 351,812 Im
Indigenous Pig Meat 68,788 0
Tea 55,895 52,559 P
Indigenous Goat Meat 53,512 0
Mangoes, mangosteens & guavas 49,527 82,659 Im
Cotton Lint 39,017 27,300 F
Paddy Rice 36,896 135,988
Fresh Vegetables 30,530 162,012 Im
Indigenous Chicken Meat 25,713 0
Cow Peas 18,073 72,082

Read more about this topic:  Economy Of Malawi

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