Factors Affecting the Development of Non-Traditional Export: A Case Study of the Cut Flower Industry in Malawi

Abstract

Malawi has a narrow export base comprised mainly of tobacco (65%) tea (8%) and sugar (6%) as the main sources of foreign currency. Cut flowers were identified as one of the export products that could help wean the country’s economy off its high dependency on tobacco leaf exports. The decreasing price of tobacco at the auction floors coupled with new anti smoking legislations worldwide has made alternative crop exports critical. The Malawian cut flower industry has its roots in a horticultural pilot project set up by the government in 1988. Lingadzi Farm was the largest and the first to be set up. Maravi Flowers then followed it. Lingadzi Farm closed in 2000 due to high freight costs and was closely followed by the opening of Zikomo Flowers. However, the Malawian cut flower industry has been unable to develop at the same rate as those other Southern African countries like Zimbabwe, Zambia and South Africa. Her cut flower exports has dropped to under 0.5 million Euros from a high of 2.5 million Euros in 1996. Zambia and Tanzania, two neighbouring countries, on the other hand started at the same time as Malawi and have grown tremendously reaching 20 and 15 million Euros in exports respectively. Unlike the Kenyan and Zimbabwean industries, the Malawian cut flower industry has been unable to develop an out grower or smallholder scheme to increase volumes. The two cut flower farms continue to operate amid rather difficult circumstances.