Revitalizing Malawi’s Economy: Driving Growth through Diversified Production

Key Business Points

• Malawi must transition from potential to productive capacity to compete in regional and global markets, with a focus on building scale and large-scale industrial capacity.
• Financing must be redirected from consumption to production and export-oriented sectors to drive growth and generate sustainable forex, with a shift towards industrial infrastructure, agro-processing, and mining.
• Private sector leadership is crucial in driving Malawi’s export agenda, with a need to address constraints such as forex shortages, high logistics costs, and energy instability, and to lead in areas like soya, cane sugar, pulses, and services.

The recent Malawi Trade Report 2025 has highlighted the need for urgent action to address the country’s trade deficit, which stands at $2.4 billion. The report shows that exports fell to $958.5 million in 2024, while imports remained high at $3.3 billion. Economic and private-sector leaders have warned that Malawi’s inability to produce at scale is a major weakness, and that the country will remain trapped in a cycle of exporting raw commodities and importing expensive finished goods unless it builds large-scale industrial capacity.

Building scale is critical to restructuring trade and narrowing the deficit, according to EDF managing director Frederick Chanza. He emphasized the need to bring online the productivity needed for Malawi to supply regional and global markets. To achieve this, EDF is shifting financing towards industrial infrastructure, agro-processing, and mining to fast-track export growth and generate sustainable forex.

The issue of financing is also a major concern, with FDH Group chief executive officer William Mpinganjira noting that liquidity exists in the banking system, but is being channelled into government securities instead of export-oriented production. He emphasized that financing will only be sustainable when it is channelled to export-oriented sectors. MCCCI board member Godwin Ng’oma highlighted the constraints crippling industry competitiveness, including forex shortages, high logistics costs, and persistent energy instability.

Ng’oma challenged the private sector to take the lead in driving Malawi’s export agenda, rather than waiting for government. He noted that the opportunities in soya, cane sugar, pulses, and services are clear, and that industry must lead the way. Unima associate Professor Winford Masanjala emphasized that Malawi’s trade structure still reflects colonial-era patterns, and that the country needs to diversify and add value to its products.

The government has also acknowledged the need for action, with Secretary for Industrialisation, Business, Trade and Tourism Wiskes Nkombezi stating that the report’s findings will be used to drive Malawi 2063’s structural transformation agenda. He emphasized the need for fundamental realignment, rather than incremental adjustments, and for policy consistency to attract investment.

Overall, the message is clear: Malawi needs to transition from potential to productive capacity, and to position the private sector as the engine of export-led growth. This requires a focus on building scale, redirecting financing, and addressing the constraints that are crippling industry competitiveness. As Ng’oma noted, "Tiyeni tisunge kwa azungu" – let us move forward with the foreigners, but also let us take the lead in driving our own economic growth.

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