Key Business Points
- Addressing structural weaknesses is crucial for Malawi’s economic growth beyond 2026, including the debt interest trap, weak foreign exchange and export base, and low productivity in agriculture and industry.
- Diversification and commercialisation of agriculture, investing in high-value export crops, and improving irrigation infrastructure and agro-processing value chains can help reduce dependence on maize and boost exports.
- Reliable and affordable power is essential for industrialisation, and resolving the debt and governance crisis at the Electricity Supply Corporation of Malawi can unlock independent power producer investments and expand generation capacity.
Malawi’s economy is at a critical juncture, and sustained recovery and growth beyond 2026 will require urgent attention to deep-seated structural weaknesses. According to Economics Association of Malawi (Ecama) president Bertha Bangara Chikadza, the country’s growth prospects will remain fragile unless authorities address three binding constraints: the debt interest trap, a weak foreign exchange and export base, and low productivity in agriculture and industry. Chikadza emphasized the need for agricultural commercialisation and diversification, investing in high-value export crops such as macadamia and soybeans, and improving irrigation infrastructure and agro-processing value chains.
To achieve industrialisation, reliable and affordable power is essential. The debt and governance crisis at the Electricity Supply Corporation of Malawi must be resolved to unlock independent power producer investments and expand generation capacity. Chikadza stressed that energy must be treated as an industrial platform, and projects such as Mpatamanga Hydroelectric Power are critical medium-term enablers for industrialisation and power reliability. Additionally, deepening digital and financial inclusion through wider use of mobile money and fintech solutions can improve access to finance, reduce transaction costs, and increase efficiency in both public and private sector operations.
On governance, Chikadza called for stronger public financial management systems, greater transparency in procurement, and more robust anti-corruption institutions. Improving the efficiency of public spending and rebuilding trust with investors and development partners is essential. The International Monetary Fund’s debt and interest projections underscore the urgency of reform, and without institutional discipline, debt servicing will continue to crowd out development spending. As Consumers Association of Malawi executive director John Kapito noted, sound and realistic price stabilisation policies are needed to cushion consumers from the elevated cost of living, and maximising food production can help ease these problems. With the Reserve Bank of Malawi revising down its 2025 GDP growth forecast to 2.7 percent, it is clear that zinthu zina zikugwira ntchito (things need to work) to achieve sustained economic growth and development in Malawi.
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