Three agro industries’ GDP contribution drops
The agricultural, forestry and fishing sector’s contribution to the country’s Growth Domestic Product (GDP) has shrunk– a recent Reserve Bank of Malawi RBM economic report shows.
The quarterly economic report projects the sector to grow by 1.4 % in 2022 from 3.8 % in 2021.
It comes weeks after a World Bank report said the agriculture sector is slowly losing its grip as the main contributor to GDP.
According to the Reserve Bank of Malawi(RBM), the sector was hit by adverse weather conditions during the early stages of the 2021/22 growing season, in addition to the sharp rise in prices of agricultural inputs, particularly fertilizers.
This resulted in a contraction of 1.7% in crop production despite animal production being estimated to increase by 6.7% attributable to improved management practices which resulted in high output.
Meanwhile, the fishing sector is projected to contract by 0.9 % this year.
Prospects for 2023 indicate that the agriculture sector will grow by 2 percent, premised on favorable rainfall conditions.
Among other subsectors, tea and tobacco industries also faced production challenges, with the former’s third quarter production amounting 6.9 million kilograms, significantly lower than 13.5 million kilograms produced in the second quarter.
Owing to the low quantity of sales and average price, total tea earnings for third quarter were lower at US$1.8 million than US$ 6.8 million for the second quarter.
Similarly, Tobacco production dropped significantly in 2022 with the sold volume 31.2% lower than 123.7 million kilograms recorded in 2021.
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