The International Monetary Fund (IMF) Tuesday maintained a 3.3 percent gross domestic product (GDP) growth forecast for Malawi in 2024.
The growth forecast is contained in a World Economic Outlook report released Tuesday afternoon by the Bretton Woods institution on the sidelines of the IMF/ World Bank Spring Meetings currently underway in Washington DC, United States of America.
According to the fund, the local economy is expected to grow by 3.8 percent next year before accelerating by 4.6 percent in 2029.
In January, an IMF Mission had predicted a 3.3 percent GDP growth before the prolonged dry spell that significantly affected crop production in many districts of the country.
According to the World Economic Outlook despite gloomy predictions, the global economy remains remarkably resilient, with steady growth and inflation slowing almost as quickly as it rose.
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It says global growth this year and next will hold steady at 3.2 percent, with median headline inflation declining from 2.8 percent at the end of 2024 to 2.4 percent at the end of 2025.
The Bretton Woods institution has also projected less economic scarring from the crises of the past four years, although it says estimates vary across countries.
The IMF notes that bringing inflation back on target should remain the priority.
Going forward, the Fund says, policymakers should prioritise measures that help preserve or even enhance the resilience of the global economy.
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“The first such priority is to rebuild fiscal buffers. Even as inflation recedes, real interest rates remain high and sovereign debt dynamics have become less favorable.
“Credible fiscal consolidations can help lower funding costs, improve fiscal headroom and financial stability. Unfortunately, fiscal plans so far are insufficient and could be derailed further given the record number of elections this year,” IMF says.
Finance Minister Simplex Chithyola Banda was not immediately available for comment Tuesday.
Chithyola Banda has over the past months insisted that the local economy has hit the corner and that it is on its way to recovery.
Last week, the World Bank has released the Africa’s Pulse report which said it sees economies in Sub Saharan Africa, including Malawi, rebounding in 2024.
Africa’s Pulse called for several policy actions to foster stronger and more equitable growth including restoring macro-economic stability, promoting inter-generational mobility, supporting market access, and ensuring that fiscal policies do not overburden the poor.
