Example of Low Income Country: Malawi

  • Created by: saahirahx
  • Created on: 08-04-21 14:35
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  • LIC: Malawi
    • The local market for goods is limited since 90% of the population earns less than $2 a day.
    • People tend to live in remote rural areas and there are few roads and means of transport for goods.
    • Plots of land are small, soils are infertile, weather is unfavourable and there is limited use of fertilisers. Productivity has not improved since the 1970's.
    • The AIDS epidemic has affected 12% of the population. Illness or injury is common.
    • Families are large and 2.8 million people suffer from chronic malnutrition.
    • Malawi is landlocked country and hence finds it difficult to trade with the rest of the world.
    • The economy depends on the export of low-value primary goods such as tobacco, tea, cotton and sugar. Imports are dominated by high-value products such as oil and machinery
    • Education standards are poor, for example almost 30% of children do not attend primary school even though it's free.
    • Tea is processed in 21 factories; 16 are owned by UK-based companies
    • The economy is heavily dependant on aid from the IMF and the World Bank.
    • 90% of Malawi's tea is exported to the UK and South Africa
    • The reliance on the export of agricultural commodities renders Malawi vulnerable to fluctuations in world trade, tariffs, quotas and environmental disasters such as drought
    • Malawi's imports are dominated by fuel products, compromising 30% of its import bill.
    • Tea is cultivated in 44 estates owned by 11 international companies
    • The tea industry alone employs 50,000 seasonal workers. At the end of the season the tealeaf pickers are out of work.
    • There are also 10,000 locally owned smallholder tea famers in Malawi.
  • Agriculture employs 84% of the labour force and accounts for 85% of export earnings.


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