Ambassador Virginia Palmer at the MITC Financiers Forum

  • Thank you, Clement. I am honored to be here today and I congratulate the entire MITC team for putting together this event.
  • Let’s make a deal!  The 1960’s American game show can be a motto for us today. We’re here to see how we can make business deals happen.
  • Malawi needs investment to grow, and has projects ready – MITC has a compendium of projects in agribusiness, power, tourism, and manufacturing, among others.
  • But since I arrived in Malawi 18 months ago, I haven’t seen any deals concluded with an American company.  Not one.
  • Malawi annually receives more development assistance ($1 billion) than it does foreign direct investment ($700 million).
  • I want that to change.  I want to make a deal.
  • MITC has done an excellent job at promoting Malawi around the world through forums like this and other excellent outreach.  The United States and Malawi share an excellent bilateral relationship.
  • Just yesterday the CEO of the Millennium Challenge Corporation broke ground with Minister Msaka on work at the Nkhoma power substation as part of the U.S. government’s $350 million compact to transform Malawi’s power sector and prepare it for private sector investment.
  • And we have American companies ready to start producing power for ESCOM once ESCOM shows a willingness to sign the first ever Power Purchase Agreement in Malawi.
  • Malawi is a peaceful democracy with fertile land, warm English-speaking people, low levels of crime, mild climate, and an amazing lake.  I want to sing Malawi’s praises to American investors.
  • With 80% of Malawi’s economy based in agriculture, it is a prime sector for American investment and advanced technologies.  But, it’s hard to convince an American to invest in agriculture in Malawi when the Control of Goods Act allows the Ministry of Trade to unilaterally ban exports of key agricultural goods.  Bans (both explicit and implicit) create uncertainty for farmers and investors, reducing incentives to invest in susceptible sectors.
  • These bans have not had the intended consequences of lower prices for domestic consumers nor do they protect the local market.  Rather, they have created higher price volatility, which disproportionately affects the rural poor.  And they have reduced incentives to produce key agricultural products needed for food security.
  • Investors need a predictable export regime.
  • And, investors need accountability.  Malawi needs to show it is serious about accountability and fighting corruption.
  • All the work MITC does to promote Malawi is immediately erased by one investor’s doubt that its local partner isn’t honest, or one instance of an official registering their company, providing needed permits, or collecting taxes that hints at needing a pay-off to proceed.
  • The Public Service and Public Financial Management Reform programs launched by President Mutharika have all the right components to instill accountability within the public service and limit corruption, but when will Malawians get serious implementing these programs?
  • Launches and strategies aren’t what make investment happen.  Serious work by serious people does.
  • We have American companies ready to invest and we’re ready to tell them about the great potential of the Warm Heart of Africa, but I can’t honestly do that until I see Malawians are ready.
  • I mentioned that MITC has a compendium of projects ready for investment and for those who want to invest in Malawi and are looking for opportunities, the compendium it is great place to start.  But, I think we all recognize that a vibrant economy is one where innovators and entrepreneurs – not just governments – identify opportunities.  And, in that sense, Malawi is as fertile as the creative minds of the investors in the room here today.  I urge you to look beyond just the compendium and bring your ideas forward; and I urge the government to facilitate those investments just as much as those in the compendium.
  • So, if you are serious – serious about removing export controls, serious about fighting corruption, serious about accountability – then we are here to help.
  • Today we have with us from the United States Government
    • RJ Donovan from the U.S. Department of Commerce’s Foreign Commercial Service.  He, together with our economic team at the Embassy, can help Malawian companies find American partners and suppliers.
    • Peter Ballinger from the U.S. Overseas Private Investment Corporation (OPIC), which provides loans and guarantees, political risk insurance, and support for investment funds.
    • Both RJ and Peter will tell you more about their work themselves.
    • We also have Chris Chibwana who is here if anyone has questions about USAID’s Development Credit Authority (DCA) which provides loan guarantees (through Malawian Banks) to Malawians in the agriculture, education, health, and microfinance sectors with flexible and concessional terms. USAID’s DCA currently has a program with First Merchant Bank which is eager to support a wide-variety of projects, including warehouse receipts for the agricultural value chain.  USAID is also currently developing a program with Opportunity Bank with a focus on women and youth-owned SMEs and small holder farmers.
    • And OPIC also has a loan guarantee program is it developing in Malawi in conjunction with the U.S. Department of Agriculture, working with the local organization Global Communities. Nobel Moyo from Global Communities is here today and is happy to further explain the program they run to stimulate agribusiness SMEs.
  • I’m eager to showcase Malawi to U.S. investors when Malawi can show us it’s serious about removing export bans, serious about accountability, and serious about signing deals.
  • Let’s make a deal!