Malawi : Failure in export extension deal threatens textile jobs

Government of Malawi was unsuccessful to close the tax-free export extension deal with the Southern African Customs Union (SACU).

These extensions allow duty-free export status to Malawi’s textile industry. Now textile companies will face heavy tax tariffs while exporting to South African Development Community (SADC) region.

Sacu includes Botswana, Namibia, Lesotho, South Africa and Swaziland as well as Malawi, Mozambique, Tanzania and Zambia. These countries export duty free textiles and garments with in SACU.

Ministry of Trade sources revealed the reason for this rejection of extension is that Malawi failed to meet some Sacu requirements. Most imported goods enter the sub-region through South African ports, have to share a system of custom revenue which Malawi failed to meet.

This unproductive result will now threaten 6,000 jobs available in textile and garment manufacturing sector as SACU remained an important export market for the country.