If there is a song Malawians have grown weary of, it is the forex shortage anthem. There is no fuel – blame it on forex; there is no fertilizer – ask forex; there are no medicines in hospitals – point an accusing finger at forex. The list goes on, ad infinitum. When the great minds of our country convene in luxurious hotels to propose solutions to economic woes, they invariably agree that the country should increase the production of export goods. Then the rest of the strategy goes into the details of what and how much should be produced to close the forex gap. Yet, production alone cannot improve the forex situation; production has to be complemented by international marketing, for it is from international markets that the country generates foreign currency.
This article argues that Malawi's forex shortages are due to marketing, rather than production, underperformance. As a corollary to this, the article posits that the best way to stimulate the production of exportable products is to secure their markets.
A Glance at the National Strategy
The production-marketing gap can be seen in the Malawi Implementation Plan-1 (MIP-1) running from 2021 to 2030. Of the 20 strategies listed under Agricultural Productivity and Commercialisation, only two speak of markets, and these are largely focusing on local market structures, with the exception of the one that talks about the need to reform the Agricultural Development and Marketing Corporation (ADMARC) to ensure it has international linkages. Similarly, of the 67 strategic initiatives listed under Agricultural Production and Commercialisation, only 7 (10%) fall under the Ministry responsible for trade, against 25 (37%) under the Ministry of Agriculture. When production is not matched with international marketing, the overall economic performance remains poor. As renowned business guru Guy Kawasaki once said, viable business is a result of two functions: making and selling.
Tobacco: A Story of the Production-Market Mismatch
One shining example of the inconsistency between production and marketing is Malawi's tobacco industry. For two consecutive years, Malawi is said to have oversupplied tobacco. In 2025, the country produced 221 metric tons against the demand of 213 metric tons, translating into a production surplus of 8 metric tons. As a result, by October 2025, K17 billion-worth of tobacco had not yet been sold due to lack of demand. Further, tobacco oversupply resulted in the dampening of tobacco prices due to enhanced buyer bargaining power.
The same scenario is playing out in 2026. According to official reports, Malawi's tobacco production is projected at 197 metric tons against a demand of 170 metric tons, resulting in a surplus of 27 metric tons — that is 19 more tons than in 2025. The trends also show that the market for Malawi's tobacco has shrunk by 20% from 2025 to 2026. In 2009, Malawi's tobacco sales peaked, netting in US$901 million from 232 metric tons. This means that demand has dropped by 27% (more than a quarter) from 2009 to 2026.
The consequences of the supply-demand mismatch are manifesting at the auction floors: rejection rates as high as 98% and prices as low as $1.20/kg.
Yet, while the market demand for Malawi's tobacco is on a steady decline, the country's grand strategy is focused on production growth. To wit, according to MIP-1, Malawi's tobacco production is supposed to hit 500.59 metric tons by 2030, from a baseline of 114 metric tons in 2021. The million-dollar question is: if Malawi is failing to sell 197 metric tons, where will it find the market for 500 metric tons in just a matter of 4 years?
Positive Feedback Loops: Lessons from Cotton
An inscription in one ancient building reads, 'What you are is what we were and what we are is what you shall be'. These are words attributed to human skeletons artistically arranged in a corner of the building. They are a vivid reminder of the fate of all humans. One can imagine cotton addressing the same words to tobacco: 'What you are is what you were and what we are is what you shall be' — if you do not address the production-market mismatch.
Once upon a time, cotton was grown in almost every corner of Malawi, with ADMARC providing a consistent market. The privatization of the cotton market led to price declines, which in turn demotivated farmers and translated into production decline. This is what Donella Meadows calls negative feedback loops or double causality — decreasing the price of cotton leads to the decrease in production. In 2025, Malawi's cotton production was estimated at 22,000 metric tons against a target of 50,000 metric tons. Tobacco could be headed in the same direction.
But this does not have to be the same. The global value of the tobacco industry is projected to grow at a compounded annual growth rate of 2.57% (Statista). In spite of the evolving tobacco industry dynamics, China (the leading tobacco producer) is still able to generate US$893.4 billion from the product. It would be instructive to find out how the Asian country manages to sustain the supply of such volumes of tobacco.
Strategies for Strengthening Malawi's Marketing Capability
One New York Times bestselling author once quipped that writing a book should take up 1% of an author's effort; the other 99% should go into selling it. He added that it is not necessarily the best writers who end up on the best-seller list; rather, it is the best marketers who clinch the bestselling status. The same logic can apply to Malawi: the key constraint we should be addressing is access to international markets. Once we get that right, the rest shall be given unto us. Here are a few strategies to consider.
There is a market for our products out there, except that we have not yet found it.
Firstly, we need to aggressively look for markets abroad. One of the busiest ministries should be that of trade. In the age of digital connectivity, desk research can go a long way in discovering demand across the globe. A simple search such as 'Which country needs cow peas?' could yield a useful starting point for the search for international markets.
Secondly, the country can leverage the Malawian diaspora to scout for markets. Malawians or people of Malawian origin are scattered across the globe. They know what we produce and who needs our products abroad. Their market intelligence can help us close the production-market gap. An information sharing platform can be created to that effect.
Thirdly, Malawi has embassies and high commissions across the globe. Their job is not just to mediate foreign direct investment initiatives. They are also supposed to look for markets for what we produce — or advise the country to produce what is currently marketable in those specific countries. Contracts can then be signed between the two countries to hedge against price- and demand fluctuations.
Conclusion
Meaningful participation in the global economy is predicated on national extroversion. An introverted country will be unable to market its products across borders. This failure then engenders a domino effect capable of paralyzing an entire economy. Malawi is currently acutely introverted, focusing on the production of goods without clear market outlets.
Our forex woes will begin to end the day we start aggressively chasing international markets.
