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A political economy analysis of the Nacala and Beira corridors

A political economy analysis of the Nacala and Beira corridors
Photo credit: Swathi Sridharan via Flickr

07 Jul 2020

While trade and transport costs in Africa are high, those faced in Malawi are higher than in the wider region. International partners are keen to invest in improving trade and transportation, with a view to promoting socio-economic development in the region, but trade and transport are highly political in both Malawi and Mozambique.

This ECDPM study maps out the different factors and actors that shape current use of the Nacala and Beira corridors connecting Malawi to the Mozambican coast. High-level political relations have fluctuated through time, and though cordial, do not provide a solid basis for improving efficiency along the Nacala rail corridor, with domestic priorities on both sides dominating cross-border cooperation. Thus far, Beira has emerged in Mozambique as the more efficient port serving Malawi and the wider region where state-business relations have aligned with political objectives. Nacala has been made efficient for coal exports but coordination for other trade is lacking, with political interests more geared towards a competition for control of rents. Mozambican road transporters have also the upper hand over Malawian transport, though the market is highly segmented for imports and exports and different goods.

Given the numerous players and services involved in the transport sector, cross-border coordination will be required to raise efficiency of the corridor – the need for this is only increased by the COVID-19 pandemic. Coordination efforts are underway in Beira, but are less apparent in Nacala. While transport in both countries is a political issue, it is unclear whether raising efficiency is among the top priorities of the leaders or highlevel actors on either side, though this may change with the newly elected Malawian president. In the absence of a champion that can coordinate activities and push for particular interests, one can only expect incremental use of the Nacala corridor in the short to medium term though the longer-term potential remains.

External support to improve efficiency will need to take account of the vested state-business interests round the ports and corridors, particularly in Mozambique, and rekindle multi-actor cross-border coordination mechanisms, ideally including different government bodies, private service providers as well as businesses engaged in exports/imports, and learning from past failures to coordinate better.

Download the paper here.

The authors of this paper are Bruce Byiers, Head of the African Institutions and Regional Dynamics Programme, ECDPM; Poorva Karkare, Policy Officer; and Luckystar Miyandazi, Policy Officer: African Institutions and Regional Dynamics Programme.

Author Bruce Byiers, Poorva Karkare and Luckystar Miyandazi
Source ECDPM
Website Visit website
Date 07 Jul 2020
 
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