Blantyre, Malawi: Potential Opportunities for Investors - Millennium ...

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Chilli processing Blantyre presents an attractive opportunity to invest in a chilli processing plant. New investors with access to technology and relevant markets could invest in a plant that produces goods such as chilli sauces that demand a high premium in international markets. Indicative market size for chilli sauces 2008 Source: KPMG in Malawi interview programme, Datamonitor Blantyre, Malawi: Potential Opportunities for Investment 28 US Regional Malawi US$0.5bn US$1m US$3m © 2009 KPMG International. KPMG International is a Swiss cooperative. Member fi rms of the KPMG network of independent fi rms are affi liated with KPMG International. KPMG International provides no client services. No member fi rm has any authority to obligate or bind KPMG International or any other member fi rm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member fi rm. All rights reserved
Chilli export value chain in 2008 Price Volume Demand There is high international and domestic demand for Malawian chilli sauces. Bird’s eye and paprika are two renowned varieties of chillies grown in Malawi. The chillies are typically used in sauces and other condiments and enjoy high demand in Europe, the US and South Africa. The regional market, including South Africa, is estimated at around US$43 million for processed chilli products. The largest opportunity for exporting processed bird’s eye chilli sauce is the US, which had a market size of approximately US$4500 million in 2008. Significant potential also exists for exports to the UK and Europe. Chilli forms an integral part of the Malawian diet. The domestic market for processed chilli products in Malawi was US$1 million in 2008. It is expected that as incomes rise, consumption of processed chilli products will also increase. Blantyre, Malawi: Potential Opportunities for Investment 29 Export Exports of processed chilli yields significantly higher prices than raw chilli. An analysis of the value chain indicates that raw chilli bought at US$3 per kg from farmers is exported at about US$4 per kg. Conversion to sauce can yield up to US$56 for each kilogramme of chilli processed. Volume Very low volumes of chilli are being processed in Malawi: only three percent — 50 metric tonnes (MT) — were processed in Malawi, but were all sold locally. There have been no exports of processed chilli products. Nali and NASFAM are the main players and are currently only focused on the domestic market where there is still an opportunity of around two metric tonnes. Raw chillies Export of dry chillies Export of chilli sauce US$3.2 per kg 100 MT of raw chilli Source: KPMG in Malawi interview programme UNESCO and Malawi – 2008 Columbia University, SIPA: Foreign Direct Investment in Blantyre: Opportunities and Challenges Farming chillis US$4 per kg US$56 per kg 100 MT of raw chilli Drying and exporting raw chillis 100 MT of raw chilli Processing chilli sauce © 2009 KPMG International. KPMG International is a Swiss cooperative. Member fi rms of the KPMG network of independent fi rms are affi liated with KPMG International. KPMG International provides no client services. No member fi rm has any authority to obligate or bind KPMG International or any other member fi rm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member fi rm. All rights reserved
Page 1 and 2: Blantyre, Malawi Potential opportun
Page 3 and 4: Foreword As part of KPMG’s Global
Page 5 and 6: At the crossroads of development Bl
Page 7 and 8: Key ••••• •••••
Page 9 and 10: Introduction to MCI The Millennium
Page 11 and 12: Economic trends Malawi has witnesse
Page 13 and 14: Foreign direct investment in Malawi
Page 15 and 16: Land availability and acquisition T
Page 17 and 18: Railway projects 2009-2012 Railway
Page 19 and 20: Investing in Blantyre While Blantyr
Page 21 and 22: Challenges Land availability Land a
Page 23 and 24: Key indicators: comparative assessm
Page 25 and 26: Land availability There is a shorta
Page 27: Malawi Institute of Tourism The exp
Page 31 and 32: Malawi’s rising chilli production
Page 33 and 34: Groundnut processing Groundnut proc
Page 35 and 36: The value chain of groundnut proces
Page 37 and 38: Seasonality Seasonality of groundnu
Page 39 and 40: Textile value chain A typical cotto
Page 41 and 42: Blantyre, Malawi: Potential Opportu
Page 43 and 44: Mining opportunities Mining present
Page 45 and 46: Important types of mining licences
Page 47 and 48: Cost of evacuation The cost of evac
Page 49 and 50: Appendices 1 Road projects underway
Page 51 and 52: Location of road projects 2 Scale 1
Page 53 and 54: Appendix 3 Appendix 3 Secondary res
Page 55 and 56: Blantyre, Malawi: Potential Opportu

Blantyre, Malawi: Potential Opportunities for Investors - Millennium ...

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