At a time when Malawi’s economy continues to stumble, Illovo Sugar Malawi limited has disclosed that its sugar sales in the country have been hit hard to the extent of slipping to 40 percent.
The development has been attributed to incessant rate at which such commodities are being smuggled into the country.
Illovo public relations officer, Ireen Phalula is on record as having told a local daily that such commodities like sugar are largely being imported from neighboring countries like Tanzania, Zambia and Mozambique with import licenses that apply there alone.
“The net effect of this for Illovo as a company, amongst other, is that sales in the current year are down by 40 percent compared to the same time last year. Most of the sugar being smuggled into the country enters the country without Vitamin A fortification, which is a legal requirement for sugar on the Malawi market.” Phalula told local daily this week.
Phalula also said Illovo Malawi provides direct jobs to over 10,000 Malawians and that it indirectly creates even more jobs whose viability is under threat with the smuggling.
Tis comes as economic woes are forcing many companies to change their approach on business and expenditure.
Recently, Peoples Trading Limited announced the closure of 20 out of its 85 shops across the nation due to continued losses.
The Standard Bank also recently announced withdrawal of sponsoring the Standard Bank Knockout Cup, a development the bank tilted to the pace that the country’s economy is taking has made the bank “increasingly challenging” for the bank to generate revenue.
A recent report by international financial experts reveals that the Malawi Kwacha has lost about 35% of its value under the leadership of President Peter Mutharika, pinning it one of the worst currencies in Africa.
The report, published by US Financial aggregator, Bloomberg, shows that Malawi kwacha is just 2 places from the bottom of the Continent’s worst currencies hit by inflation. Slightly trailing the Kwacha is the Angolan currency. The Kwacha’s namesake in Zambia is anchoring the log.
Since his election in May 2014, Mutharika has presided over one of the worst rising inflation in Malawi, a development the report shows as one factors that has lead to “a slump in investor confidence”.
Value of Malawi Kwacha dropped to its record lowest point this month sending a shockwave of price increases on goods and commodities. Bloomberg also reports that Africa’s biggest economies such as South Africa, Ghana and Nigeria are also dancing to the same tune as that of Kwacha.