NewsSeptember 29, 2020by admin0Maiic disburses K19bn on 14 high impact projects

The Malawi Agricultural and Industrial Investment Corporation (Maiic) has over just a year of operation mobilised K11.5 billion for local projects, whose  total cost or capital expenditure is about K19 billion.

To achieve this in just a year after kick-starting its operations in October last year, Maiic has used part of its own resources (about K5 billion) invested alongside other partners.

Maiic’s financing focuses on sectors such as agriculture, agro-processing, manufacturing, tourism, mining, energy and information technology.

Initially, the Maiic board approved 16 projects but two projects pulled out after failing to adhere to the loan conditions; hence the 14 projects.

Maiic managing director Taz Chaponda said in an interview that the 14 beneficiary projects are from tourism, education, agriculture, agribusiness, manufacturing and ICT sectors.

During its first year of operations, he said the institution secured a $16 million (about K12 billion) loan facility from the World Bank, under the Financial Inclusion and Entrepreneurship Scaling Project, and an additional $500 000 (about K380 million) grant funding raised from the Malawi Innovation Challenge Fund (Mifc).

The additional funding raised represents an increase of 100 percent in Maiic funds when compared to an initial $15.3 million (about K11.6 billion) seed capital received from Maiic shareholders in 2019.

As part of the investment strategy, Maiic has attracted and partnered with two development finance institutions namely, the Development Bank of South Africa (DBSA) and Trade and Development Bank (TDB).

Chaponda explained: “These regional development finance institutions [DFIs] consider Malawi a priority investment destination but have failed to make headway in recent years due to limited bankable projects.

“Maiic is acting as a catalyst for economic development in the country by mobilising external financing, providing advisory services and conducting project development to make the projects attractive to financiers and investors”.

The institution has managed to attract the additional funds through its strong value proposition to local and regional partners which has allowed it to preserve its core capital.

In 2021, Chaponda said Maiic will be going out to the local market to raise even more funds for local investment.

He explained that Maiic is offering not only the debt financing but also equity and quasi equity products. In addition, Maiic will be rolling out a new product which provides a partial credit guarantee for SMEs.

It is expected the approved projects will support 32 144 indirect jobs.

Associate professor of economics at the Polytechnic, a constituent college of the University of Malawi Betchani Tchereni described the reported developments at Maiic as exciting, more so that it is focusing on relatively big projects.

“For Malawi to really think about industrialisation there is need to think and act big, which is exactly what is happening through Maiic,” he said.

Maiic was launched in 2018 to be the leading enabler of high impact economic development in Malawi. The aim was to provide affordable financing to SMEs and businesses that lack sound capital to take off or grow.




Leave a Reply

Your email address will not be published. Required fields are marked *