Re: [ujeni] Economic fallout again!
- This came as a shock to me, too. I had no idea what what happening with them. Kristof and I were in there a few times recently and commenting on how nice everyone is there and how efficiently they run. I don't know how it keeps happening! Stacia----- Original Message -----From: WeberCc: Debbie YinSent: Monday, September 09, 2002 11:49 PMSubject: [ujeni] Economic fallout again!I thought David Whitehead cloth was one of the shiny lights of quality that Malawi produced with good export potential, even here. Drat!!! How does this keep happening? CathyMalawi to shut biggest
Malawi has said it will shut down the country's
largest textile factory, putting more than 2,000
people out of work, after plans for privatization
The government has decided to stop
subsidising the factory because of heavy
financial losses, the Commerce and Industry
Minister Peter Kaleso said.
Only last month Mr Kaleso said that the
government was looking for a strategic partner
for the state-owned David Whitehead and
Sons (DWS) factory and he was predicting a
The closure comes even though Malawi has
seen textile exports surge since it signed the
African Growth and Opportunity Act (Agoa)
treaty with the US in September 2001.
In the last year the industry's yearly growth
rate was reported to be 120%.
DWS is the main source of cotton yarn, fabrics
and African prints exported from Malawi
according to the local Confederation of
Chambers of Commerce and Industry.
The company hit financial difficulties in the
early 1990s when the government ended its
monopoly status - in-line with International
Monetary Fund and World Bank policies - and
liberalised the textile market.
The resulting imports of second-hand clothes
from the Far East virtually destroyed domestic
production in Malawi, as in many other African
DWS was one of the companies that launched
Malawi's privatisation programme but like many
others has now been shut down after failing to
find a buyer.
In a letter of intent to secure poverty
reduction funding, Malawi promised to liquidate
DWS in July 2002.
DWS is 51% owned by the Malawi Government
and 49% by the state owned Admarc
Investments Holding Company.
The government has set aside about 140m
kwacha ($2m; *1.3m) to compensate workers.
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