Blantyre – Malawi has unveiled plans to roll out tax measures that will facilitate greater regional integration and boost trade and economic growth.
Among these is a duty-free week for imports not exceeding US$3,000.
In the 2021/2022 National Budget presentation in Parliament, Finance Minister Felix Mlusu said the duty-free week was designed to primarily support SMEs. Minister Mlusu said Malawi would also increase the COMESA Simplified Trade Regime threshold from US$2,000 to US$3,000, also to bolster small businesses.
“This trade arrangement will allow cross border traders to enjoy duty-free status when they import goods originating from other member states in the COMESA region,” he said.
The initiatives follow Malawi’s ratification of the African Continental Free Trade Area (AfCFTA) Treaty in January 2021.
The AfCFTA provides an opportunity for the continent to enhance its productive capacity and build robust regional value chains to effectively supply the African market with an estimated 1.3 billion consumers and a combined GDP of around US$3.4 trillion.
The Malawi government is in a drive to empower entrepreneurs in the informal sector. Currently, informal businesses are being supported to form cooperatives and develop skills that will enable them produce quality products for the local and export markets.
Business in the Sub-Saharan Region is expected to improve as the economic outlook projects a GDP growth rate of 3.4 percent in 2021 and four percent in 2022 from the region’s largest ever contraction of minus 1.9 percent in 2020, caused by COVID-19.
Malawi;s economic growth, recorded at 0.9 percent in 2020, is expected to jump to 3.8 percent in 2021 and 5.2 percent in 2022.