EU Relations with Malawi

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Malawi is a landlocked country located in eastern Africa. It is a small country of 118,500 km² and has a population of 12.9 million people, making it one of the most densely populated countries in Africa. 90% of the population lives in rural areas.

Malawi is classified as Least Developed Country and faces many development challenges: high levels of poverty, a high HIV/AIDS rate, poor health services, high interregional transport costs, high food security sensitivity and low life expectancy.

The economy of Malawi is predominately agricultural. Agriculture accounts for more than one-third of GDP and 90% of export revenues. The performance of the tobacco sector is key to short-term growth as tobacco accounts for more than half of exports. The economy depends on substantial inflows of economic assistance from international organisations and individual donor nations

Key issues in EU-Malawi relations

The EU is a long-time donor of support to Malawi. With the launch of the 10th European Development Fund (EDF), the EU and Malawi have developed a Malawi-EC Strategy which supports good governance and macro-economic stability. A main element of development cooperation under the 10th EDF is the provision of General Budget Support, which accounts for 35- 40% of the allocated budget and builds upon the efforts made since 2004 to improve the country’s macro-economic situation, strengthen public finance management systems and carry out education and health policy reforms.

The Malawi-EC Country Strategy Paper was (CSP) signed in December 2007 covering the period from 2008–13 with a budget of € 451 M.

25% of the CSP budget has been allocated to ensure agriculture and food security in the context of development and regional integration. The goal is to reduce poverty and hunger in an environmentally friendly way. Work needs to be done to shift Malawi away from being an importing and consuming country to an exporting and producing country.

Better regional interconnection is to be achieved mainly through improved transport infrastructure which receives 15–20% of the total budget. With better roads and railways, transport can be faster and safer, reducing transport costs. This will increase Malawi’s competitiveness and contribute to the goal of poverty reduction.