Overview of Internal Trade Division

The objective of the Internal Trade Division is to expand the market share for internally produced goods, promote local participation in businesses and safeguard consumer interests. The Division is the focal point for discharging the Ministry's statutory responsibilities affecting the internal trade operations.

This division is responsible for business licensing, registration of garages, incorporation of companies and registration of business names, ensure efficient distribution of goods, advisory services and development, enforcing laws affecting internal businesses and liaising with other Government Institutions.

This is headed by Deputy Director of Internal Trade who reports to the Director of Trade.

Programmes for Internal Trade

1. Businesses Licensing

This is done under the provisions of the Businesses Licensing Act, Chapter 46:01 of the Laws of Malawi.  Under this Act, trading licenses are classified into 8 types, varying with the nature of the trading activity namely: Wholesaler’s, Travelling Wholesaler’s, Retailer’s, Auctioneer’s, Commercial Travellers, Agents, Travel Agents and Clearing and Forwarding Agents Licenses.

Business licensing is done for purposes of monitoring the various business operations and ensuring that businesses are conducted in an orderly manner. In the course of licensing, some revenue is raised for Government. The Business License Fees vary with the type of business operation or business license and with the grade of the trading centre where the activity is based. For purposes of closer monitoring and ensuring efficient management of business licensing, the licensing of businesses owned by indigenous Malawians are licensed by Local Government Assemblies in line with Decentralization Program. 

However, the Ministry is responsible for policy direction on trade and that all big companies and foreign businesses are licensed by the Ministry for purposes of ensuring quality and standards in the conduct of businesses.

2. Liquor Licensing

This is generally similar to business licensing except that liquor, in internal trade, is considered to be a special group of commodity requiring close attention in monitoring.  The licensing is done in accordance with the provisions of the Liquor Act and is for reasons of revenue collection and maintenance of security and safety.  However, the liquor licensing function is managed by the Ministry of Local Government and Rural development.

Nonetheless, being regarded generally as the 'Ministry responsible for businesses, this Ministry and specifically the Internal Trade Division occasionally handles enquiries relating to liquor licensing and especially the establishment of businesses which are grocery-cum-bottle stores.  

3. Incorporation of Companies and Registration of Business Names

These are done in accordance with the provisions of the Companies Act and the Registration of Business Names Act respectively.  

The Registrar General, under the Ministry of Justice, in his capacity as Registrar of Companies and Registrar of Business Names processes the applications. The Ministry occasionally handles enquiries on the incorporation of companies and registration of business names.

4.Ensuring efficient distribution of goods

The Internal Trade Division shoulders the responsibility of ensuring the efficient distribution of various commodities and goods countrywide by monitoring the availability of the goods, especially essential commodities such as salt, sugar, soap, cooking oil, maize flour etc. The monitoring is done by way of undertaking general enquiries, field visits and reports from Ministry’s representatives in the cities and districts as well as liaising with the major producers and marketing agencies;

5. Advisory Services and Development of Malawian Traders

Local as well as foreign traders intending to invest in the country are given the requisite advice or lead information linking with other facilitating organizations such as Malawi Investment and Trade Centre (MITC) (previously Malawi Investment Promotion Agency (MIPA) and Malawi Export Promotion Council (MEPC)), Malawi Confederation of Chambers of Commerce and Industry (MCCCI) etc. as to how they can go about setting up their businesses in accordance with the prevailing laws and regulations.  

Since a large part of Malawi's Internal trade is dominated by traders of foreign ethnic groups, particularly businessmen originating from the Asian continent, the development of indigenous Malawian traders is one of the primary objectives in the promotion of the country's Internal trade.  The idea is to enhance local participation.  

The Development of Malawian Entrepreneurs Trust (DEMAT) was therefore, established for the primary objective of training indigenous Malawian business people for the purpose of promoting local participation in trade activities.

6. Enforcing Laws affecting Internal Business and liaising with other Government Institutions  

The enforcement of and liaison on various laws and regulations affecting the running of trading operations and informal businesses is also an important task of the Internal Trade Division.  The Division works with the Ministry of Local Government and Rural Development in order to maintain orderly trading as well as vending in urban centres. 

The division is therefore, in the process of formulating a Vending Policy that will assist to come up with rules and regulations for easy guidance on vending activities.

The division also liaises with the Ministry of Internal Affairs and other agencies to ensure that only those foreigners with requisite residential permits i.e. Business Residence Permits (BRP) and Permanent Residence Permits (PRP) are granted trading or business licences.  The Division works closely with the Directorate of Small and Medium Enterprises (SME) and Cooperatives on all matters relating to the development of the SME sector.

7. Price Monitoring 

It is often argued amongst economists that price controls in the productive sector contribute to inefficiencies and uncertainties in resource allocation and corporate decision-making and that they are a tax on the administrative capacity of the Government and management time.  Nonetheless, such an argument tends to be more easily accepted in situations where perfect competition in all sectors and sub-sectors exists.  In Malawi the situation is generally such that competition is lacking in many areas of production. However, competition in the Internal market, nevertheless, has been enhanced considerably by the general liberalization of imports.  

Regardless of the above, the Internal Trade Division administers the legal provisions pertaining to price displays in accordance with the law under the Control of Goods Act which requires that the prices of goods in trade be displayed. The main purpose is to avoid cheating and exploitation of consumers.

In this respect, the Internal Division undertakes the following:

a) Investigations into business complaints, including those relating to prices and conditional selling;

b) Protection of consumer welfare in liaison with other organisations such as the Malawi Bureau of Standards (MBS), Consumers Association of Malawi (CAMA) etc.; and

c) Monitoring the general trading conditions and price developments in the country.

 

Policy Initiatives

The Department of Trade and specifically the Internal Trade Division, is involved in the work on the trade policy initiatives. All the initiatives are formulated in consultation with many stakeholders, including the private sector itself.  The initiatives are aimed at creating a policy environment which is conducive to the private sector-led economic development.  

Some of the policies being initiated include, the Anti-Counterfeit Policy, Vending Policy, Businesses Licensing Policy etc.

 
Vision

Making Malawi a preferred domestic market.

Mandate

Provide leadership in the regulatory, policy formulation and implementation so as to stimulate growth of domestic trade.

Mission

To enhance growth and competitiveness of domestic trade in goods and services through creation of conducive trading environment.

Strategic Objective

To expand the market share of domestically produced goods on the domestic market while ensuring availability of essential goods through promotion of conduicive environment.