Friday, December 7, 2012









  • Your Excellency Chief Justice Richard Banda, SC, (Rtd)

  • Honourable Sidik MiaM.P. Minister of Transport and Public Works,

  • Cabinet Ministers and Deputy Ministers

  • Representatives of Vale Logistics Limited

  • Representatives of Mota-Engil

  • T.A. Saimon

  • Traditional Authorities 

  • Members of Parliament

  • All Senior Government Officials Present Here

  • Members of the Press

  • Ladies and Gentlemen

It is with great pleasure that I stand here at Neno to preside over the ground breaking ceremony for the construction of
Kachaso to Nkaya railway.

The development of Malawi’s infrastructure is one of the five priority pillars of my Government’s Economic Recovery Plan. Projects such as the one we are celebrating today make it easy to understand why.

Distinguished Ladies and Gentlemen,

We know that for Malawi to grow and prosper we must increase our export earnings. That is why I have placed such a priority on diversifying and commercializing agriculture in Malawi. Food security is not enough, we must begin to earn income to put in the pockets of Malawians. The way we will do that is through exporting our agricultural products.

Tourism, is also a major source of export earnings around the world and contributes around 6 per cent to our GDP here in Malawi. In 2010 tourists spent 68 billion Kwacha and the sector accounts for around 163,000 jobs in Malawi;

We also know that Malawi has the potential to earn more through the export of natural resources and minerals. Mining already contributes 10% of GDP and accounts for 20% of export total export values and Malawi has a wide variety of mineral resources not yet exploited.

Distinguished Ladies and Gentlemen,

As a landlocked country we will not be able to realize the benefits of all these industries if we are not well connected to our neighbors in Southern Africa, to the rest of our continent and to the world. We know that, for example, transportation costs constitute about 60 percent of the landed cost of goods in Malawi. If we are going to be competitive regionally and internationally we need to bring those costs down. We need to make it easier to import the goods Malawi needs and export those we wish to sell to global markets. And we need to make it easier for tourists, businessmen and investors to get to Malawi and travel within our great country.

That is why this project marks an important milestone in the development of Malawi’s infrastructure. It will entail the construction of a railway line through Chapananga in Chikhwawa to Nkaya in Balaka, a distance of 138 kilometers and rehabilitation of the existing railway line from Nkaya to Nayuchi at the border with Mozambique, a distance of 98 kilometers in Malawi.
Distinguished Ladies and Gentlemen,

The construction of this line has come about because of the needs of Vale mining company who are mining coal in Moatize in the Tete Province of Mozambique. Their aim is to export about 18 million tonnes of coal annually. Whilst the coal is being mined in Mozambique, the most efficient way to get it to the port of Nacala is through Southern Malawi. And so we reached an agreement for the building of this railway.

While the aim of the line is to help Vale to transport coal, we have made sure that Malawi benefits from the construction. The construction itself represents a $1 billion investment in Malawi over three years. The project is expected to employ about 4,500 workers at its peak, of which 70 per cent will be Malawians, that is over 3,000 new jobs. Once the railway is up and running the Malawi Government will earn 8 million US dollars per year from concession fees.

Distinguished Ladies and Gentlemen,

But it is not enough that the government earns money from the line, it is important that it benefits the communities that it runs through. As well as creating jobs, the railway line will provide the region with improved transport links.

The railway line will pass through Chapananga in Chikhwawa, Nthache and Kanduku in Mwanza, Symon and Mlauli in Neno, and Nsamala in Balaka. We all know that the districts of Chikhwawa, Mwanza and Neno where the railway is passing were neglected and for a very long time known for their poverty and many areas had no reliable access roads let alone a railway line. The roads become virtually impassable during the rainy season and people from the surrounding areas where the railway is passing through are used to be cut-off from the rest of the other parts of the districts for a number of days if not weeks during rainy season.

Once the railway has been rehabilitated there will be provision for one passenger train for Malawi per day, helping to reconnect these districts to the rest of Malawi and beyond.  Stations will be constructed at Chapananga, Neno, Nkaya junction, Liwonde and Nayuchi and there will also be a number of stops at appropriate places.

Distinguished Ladies and Gentlemen,

The benefits to the area do not stop there. The new line will boost economic activity in the whole area. From increased investment in manufacturing and processing industries that will benefit from improved access to markets and reduced transport costs to enhanced potential for investment in trade and commerce activities such as retail outlets, shops, repairs and services in the railway vicinity.

Let me put some of the benefits of this new line in numbers. Two cargo trains a day will serve Malawi – adding up to a capacity of at least 5 million tons of cargo each year for exports and imports on the railway line.

It is expected that Malawi will be saving in excess 120 million US Dollars annually in transportation costs. This has the overall effect of reducing the transport costs of goods to and from Malawi by about 40 percent.

Once this project is finished, a train will only take 38 hours to travel between Nacala and Limbe at an average speed of 50 to 70 kilometres per hour compared to the present when it takes 5 to 7 days with the train travelling at 15 to 20 kilometres per hour.

Distinguished Ladies and Gentlemen,

I think we can all agree that these are impressive results. So let me at this stage give a vote of thanks and appreciation to Vale Logistics Limited for choosing to invest in Malawi and for the good cooperation it has with the Government of Malawi and the social responsibility it has demonstrated to the people along the project site. My Government will ensure that adequate support is given to Vale Logistics Limited and its contractors so that the people of Malawi benefit from this project.

May I also urge Ministry of Transport and Public Works, Government Supervisor to this Project and Mota-Engil, the contractor and the sub-contractors to carry out professional work as you have always done in previous projects.

And to the general public living along the railway construction sites, my appeal is that you should make sure that the railway is well taken care of at all times. Hon. Members of Parliament, Chiefs and responsible citizens of Malawi let us all work together to stop the malpractice of vandalism of our countries infrastructure.

Finally, I wish to welcome the strengthening of the ties between Malawi and Mozambique as a result of this project.

Distinguished Ladies and Gentleman

This project is only one of a number of planned improvements to Malawi’s infrastructure. As one of five pillars in my government’s Economic Recovery Plan, work is underway to improve Malawi’s transport infrastructure across the board, not just through improved rail links, but new and rehabilitated roads and better air links from Malawi.

These projects will take time to yield results, but even as they are being developed they will create much needed jobs in our country.

The same is true for Malawi’s economic recovery. The previous government left the economy in a terrible mess and it will take time to fix things. I have said before that things will get worse before they get better, but we must stay the course.

I am determined to do everything I can as President of this great Republic to support people in these tough times so that we can stay on the path to growth.

Where the devaluation has caused hardship my government will continue to fund public works programmes, cash transfers and school feeding to help those in need.

Where there are those at risk of hunger I will continue to ensure they get food.

And where there are those who previously feared to express their views or participate in democracy I will ensure that their rights are respected and their voices heard.

I am clear that in a little over one year’s time people will judge me not on what I have said but what I have done. The success or failure of important projects such as the great investment we are here to mark today will speak for themselves.

Projects such as this are not just an investment in one particular industry or one particular area, they are an investment in the future of Malawi.

Distinguished Ladies and Gentlemen,

Thank you for your attention.

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