By Kingsley Jassi:
The World Bank is today launching its Malawi Economic Monitor (MEM), a biannual report series which provides an analysis of economic and structural development issues and prospects in Malawi.
The MEM is expected to lay bare how Malawi’s economy can turn around if state-owned enterprises (SOEs) were to be transformed with efficient and market-oriented operations.
Special focus on the MEM is on the SOEs sector, which is increasingly being a fiscal burden rather than a revenue source and industrial power house.
This follows a similar call by the United Nations Economic Commission for Africa, which sees the SOEs sector as an opportune area for turning around economic performance.
- Advertisement -
In a statement, the World Bank says Malawi continues to confront external shocks, macroeconomic imbalances and structural constraints that are holding back growth.
“While the economy is showing modest signs of adjustment, growth remains below the level needed to raise incomes, create enough and better-paid jobs and, overall deliver meaningful improvements in living standards of Malawians,” the statement reads.
The MEM’s special topic is ‘Reforming Malawi’s State-Owned Enterprises for Better Services’, which highlights SOEs’ weak performance. According to a 2025 SOEs performance report by Ministry of Finance, Economic Planning and Decentralisation, the SOEs contribution to the economy has been declining, largely due to inefficient operations as many are in loss making mode, increasing flows from the Treasury to keep them afloat.
The report shows total assets held by SOEs rising slightly from K2.37 trillion in 2024 to K2.5 trillion in 2025.
- Advertisement -
- Advertisement -
However, their combined share of gross domestic product (GDP) dropped from 22 percent to 20 percent, indicating their slower growth as compared to the rest of the economy.
More worrying is their falling revenue from K679.4 billion in 2024 to K561.6 billion in 2025 and, as a share of GDP, the revenue dropped from 6 percent to 4 percent.
“Fiscal flows continued to reflect structural imbalances as government grants increased sharply, especially in the agriculture sector, rising to K118 billion in 2025, while dividend remittances dropped from K20.5 billion in 2024 to K4.4 billion in 2025 due to severe cash flow constraints and rising trade receivables,” the report says.
