Malawi Country Profile

Snapshot of the Malawi Country Profile

Malawi belongs to a group of the world's least developed countries and is thus heavily dependent on donor funding to support the national budget and as a contribution to foreign exchange. Business development is marked by macroeconomic instability which has resulted in private companies mainly operating in the informal sector. Malawi remains a skeleton of a modern structure and red tape poses an obstacle to the development of the economy and an impediment to doing business.

Positive developments in relation to corruption and investment:

• Malawi has a comprehensive anti-corruption legal framework and many observers agree that the country is making a serious attempt at curbing corruption.
• Processing of commercial court cases has improved in recent years and the commercial courts are now working efficiently.

Risks of corruption:

• Companies report encountering corruption in more than a third of all encounters with the police.
• Decision-making in granting investment approval is neither transparent nor purely based on merit, and corruption is recognised by the business community in several areas, such as obtaining approval for the recruitment of expatriate staff.
• There are frequent allegations of bribery in civil and criminal cases concerning property rights, and corrupt practices are also known to exist in purchasing land and allocating land for development.
• Companies should note that customs administration is considered to be one of the most corrupt public areas, and corrupt practices are known to take place when trying to obtain import and prospecting licences.