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Agriculture and industry

The economy of Malawi is predominantly agricultural. Over 80% of the population is engaged in subsistence farming, even though agriculture only contributed to 27% of GDP in 2013. The services sector accounts for more than half of GDP (54%), compared to 11% for manufacturing and 8% for other industries, including natural uranium mining. Malawi invests more in agriculture (as a share of GDP) than any other African country: 28% of GDP.

The main agricultural products of Malawi include tobacco, sugarcane, cotton, tea, corn, potatoes, sorghum, cattle and goats. The main industries are tobacco, tea and sugar processing, sawmill products, cement and consumer goods. The industrial production growth rate is estimated at 10% (2009). The country makes no significant use of natural gas. As of 2008, Malawi does not import or export any electricity, but does import all its petroleum, with no production in country. Beginning in 2006, the country began mixing unleaded petrol with 10% ethanol, produced in-country at two plants, to reduce dependence on imported fuel. In 2008, Malawi began testing cars that ran solely on ethanol, and initial results are promising, and the country is continuing to increase its use of ethanol.

As of 2009, Malawi exports an estimated US$945 million in goods per year. The country's strong reliance on tobacco places a heavy burden on the economy as world prices decline and the international community increases pressure to limit tobacco production. Malawi's dependence on tobacco is growing, with the product jumping from 53% to 70% of export revenues between 2007 and 2008. The country also relies heavily on tea, sugar, and coffee, with these three plus tobacco making up more than 90% of Malawi's export revenue.

Due to a rise in costs and a decline in sales prices, Malawi is encouraging farmers away from tobacco towards more profitable crops, including spices such as paprika. The move away from tobacco is further fueled by likely World Health Organisation moves against the particular type of tobacco that Malawi produces, burley leaf. It is seen to be more harmful to human health than other tobacco products. India hemp is another possible alternative, but arguments have been made that it will bring more crime to the country through its resemblance to varieties of cannabis used as a recreational drug and the difficulty in distinguishing between the two types. This concern is especially important because the cultivation of Malawian cannabis, known as Malawi Gold, as a drug has increased significantly. Malawi is known for growing "the best and finest" cannabis in the world for recreational drug use, according to a recent World Bank report, and cultivation and sales of the crop may contribute to corruption within the police force.

Other exported goods are cotton, peanuts, wood products, and apparel. The main destination locations for the country's exports are South Africa, Germany, Egypt, Zimbabwe, the United States, Russia, and the Netherlands. Malawi currently imports an estimated US$1.625 billion in goods per year, with the main commodities being food, petroleum products, consumer goods, and transportation equipment. The main countries that Malawi imports from are South Africa, India, Zambia, Tanzania, the US, and China.

In 2006, in response to disastrously low agricultural harvests, Malawi began a programme of fertilizer subsidies, the Fertiliser Input Subsidy Programme (FISP) that was designed to re-energise the land and boost crop production. It has been reported that this programme, championed by the country's president, is radically improving Malawi's agriculture, and causing Malawi to become a net exporter of food to nearby countries. The FISP fertiliser subsidy programmes ended with President Mutharika's death; the country quickly faced food shortages again, and farmers developed reluctance to purchase fertilisers and other agricultural inputs on the open markets that remained.

In 2016, Malawi was hit by a drought, and in January 2017, the country reported an outbreak of armyworms around Zomba. The moth is capable of wiping out entire fields of corn, the staple grain of impoverished residents. On 14 January 2017, the agriculture minister George Chaponda reported that 2,000 hectares of crop had been destroyed, having spread to nine of twenty-eight districts.