Malawi needs to diversify its agriculture as tobacco revenue drops
MALAWI’S economy, based on agriculture, has long relied on tobacco as its mainstay crop. However, in the past decade, falling prices have severely affected the country’s biggest foreign revenue earner.
The Tobacco Control Commission (TCC) data shows that tobacco contributes about 11 percent of the country’s GDP and 60 percent of its foreign exchange earnings, while employing almost 80 percent of the country’s rural labor force. When tobacco auction halls closed this August, sales showed a remarkable drop compared to past yields.
Since Malawi’s independence from Britain in 1964, the country’s leaders have urged people to work hard in the fields knowing that it was the only way the economy could be sustained. This agricultural push worked so well that during the 1970s, 1980s and early 1990s, the Malawi kwacha was 2:1 with the British pound at the time.
At that time, tobacco was what economists described as an economy stabilizer. Every farmer wanted to grow it because it fetched better prices than other crops.
Malawi President Peter Mutharika (second right, in suit) inspecting tobacco during the opening of this year’s marketing season