Economic think-tank, the Economics Association of Malawi (Ecama), has described Malawi’s economic performance this far as poor, owing to the impact of exogenous shocks, among other things.
Ecama Executive Director Frank Chikuta said in an interview that effects of the Covid pandemic, unfavourable weather conditions and the geopolitical conflict in Ukraine continued to stifle performance of the local economy.
He said the economy sailed through problems such as high inflation, acute shortages of foreign exchange, a deteriorating fiscal position and disruptions to supply chains.
Chikuta added that intermittent energy supply and unpredictable government economic policy affected the performance of the private sector.
“The outlook for the last quarter of 2022 is unfavourable. Firstly, inflationary pressures are expected to persist as the economy enters the lean period.
“Food inflation will be affected by low supply, the high cost of agricultural inputs and the cost of imported food items. Non-food inflation will mainly depend on the exchange rate and the cost of petroleum products,” he said.
According to Chikuta, the fiscal position will remain volatile as the government recently started borrowing to finance importation of essentials including fuel and fertiliser.
Blantyre-based economist Mury Siyasiya concurred with Chikuta, saying the situation worsened poverty levels among average Malawians.
“We need to prioritise areas that are of concern; at the same time, we need to find commodities we can export so that we can attract forex,” Siyasiya said.