Project Name: Malawi’s National Export Strategy
Client: Ministry of Industry and Trade
2011-2012: Drafting of the NES, supported by the UNDP
2013-2018: Support of implementation by providing Long Term Technical Assistance through TIPSWAp, supported by the European Union Delegation to Malawi
The Government of Malawi (GoM) re-launched the National Export Strategy (NES) process in 2011 to address serious structural trade deficits. Imani Development, with financial assistance from the UNDP, assisted the GoM in drafting the NES.
About the project:
The overall strategy of the NES aims to provide a prioritised roadmap for developing Malawi’s productive base to allow for both export competitiveness and economic empowerment in a manner that is inclusive of the poor, farmers, youth, women and other vulnerable groups. Aligned to the priorities set out in the Malawi Growth and Development Strategy II (MGDSII), The NES is critical to achieving poverty reduction in Malawi, a country in which more than half the population lives below the poverty line.
The NES outlines four priority areas for sustained economic growth and poverty reduction:
- Cluster strategies: Focusing on 3 prioritised clusters with the greatest export potential; backed by strategies to map out implementation.
- Development of strategies to mitigate export constraints: these include trade policy, industry policy, the agriculture policy or the Agriculture Sector Wide Approach and the Malawi Growth and Development Strategy
- Institutional Capacity: Supporting capacity development of key agencies involved in the implementation of the NES
- Skills Prioritisation: Prioritisation of the single greatest export constraint – lack of public and private sector skills – by working with stakeholders to support the link between industry and skills / education
While it would be too early to undertake an impact assessment of the NES as a government policy, one cannot deny that it has improved the coordination and dialogue in the productive sector. The process of formulating the NES was widely consultative, covering all aspects of the economy. The process reinforced the economic diversification agenda and fostered agreement on the strategic road map to growing the economy and promoting exports. Imani’s current support to the implementation of the NES through the TIP SWAp Secretariat has thus far managed to facilitate a process of negotiating the top 5 priorities under each sub-cluster for focused implementation. Through the public-private interface taking place at the Technical Working Group (TWG) level and the oversight of the Sector Working Group (SWG), the sub-clusters have developed a Joint Sector Plan of prioritised actions which will be mainstreamed in the respective ministries, departments and agencies’ work plans.
In terms of working out the policy process i.e. NES implementation, it has been important that:
- the team is alert to policy implementation realities
- an implementation strategy is developed – Joint Sector Plan – including identification of financing, building institutional capacity, and the delegation of implementation responsibility to the respective MDAs
- the team is also in the process of setting up a rhobust M&E system
The greatest challenge has been political buy-in, and ownership at the technical level. This has translated into a slow pace in the implementation of reform agenda. A lot of effort is needed at the beginning of such policy reform processes to bring on board the political and official champions who will own and drive the change process.
The NES project had far reaching impacts:
Knowledge Impact – The NES is pivotal to the understanding of Malawi’s resource base and constraints. ‘Enablers’ were identified that Malawi can use to both overcome constraints and catalyse exports.
Level of Attribution to the NES – High. The NES is a solid attempt to document in one place all of Malawi’s productive development opportunities and constraints. Recent policies in the sector such as trade, industry, etc. are emanating from the NES. Evidence base from the NES is currently used in trade policy development.
Operational Impact – USD20 million worth of catalytic programmes around 3 sectors:
1) Oil Seeds – USD5 million
2) Sugar, a key export commodity – USD1.3 million
3) Manufacturing USD14 million
Level of Attribution to the NES – High. In a bid to respond to recommendations made in the NES, there are projects being supported under the different sub-clusters including MOEST for Oil Seeds, BEEP for Access to Finance/Markets and Institutional support, ASWAp support to Access to Skills,etc. In addition, a number of technical assistance support is also being given to build capacity.
Strategic Impact – Sector-wide approach fully integrated with NES for maximal impact in Malawi, whereas before there was a limited degree of focus. The NES is still a strategic base for further developing trade and economic policies.
Level of Attribution to the NES – Medium-High. The NES aligned with sector-wide approaches being considered across the Government of Malawi’s activities.
1) the importance of involving the relevant players in the policy process, more importantly of identifying champions for each policy objective
2) conducting open and flexible policy dialogue in a way that adapts to specific political, economic and cultural contexts
3) getting the timing right in terms of approaching the policy change as a continuing process
4) the importance of effective communication as an avenue of legitimising the policy process and reinforcing changes
5) diagnosing the development problem with backing of solid and credible analysis
6) the design of the strategy (Designing the strategy?) with a realistic accounting of the variety of factors that includes incentive structures of policy instruments and anticipated barriers to policy implementation