The World Bank has projected Malawi’s economy will grow by 2.6 percent in 2026, trailing regional peers and falling short of government targets.
The Bretton Woods institution disclosed the outlook in its ‘Global Economic Prospects 2026’ report released last week.
The forecast is 1.4 percentage points below the four percent growth projected by Finance Minister Joseph Mwanamvekha for this year.
During pre-budget consultations, Mwanamvekha also projected growth of five percent in 2027.
“The medium term looks bright; we can see light at the end of the tunnel. Growth is expected to reach four percent in 2026 and rise further in 2027. Inflation will go down.
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“You may ask where I am getting this from — we are players, we are on the ground and we know how to play. I have ‘lieutenants’ who know how to do this,” Mwanamvekha said.
According to the report, Mozambique’s economy is expected to grow by 2.8 percent this year, while Zambia and Tanzania are projected to grow by 5.8 percent and 6.2 percent respectively.
Malawi aims to attain lower middle-income status by 2030 under the 10-year Malawi Implementation Plan (MIP).
However, the 2023 MIP-1 Progress Report by the National Planning Commission found that achieving this target would require average annual growth of 10.6 percent.
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In its Economic and Fiscal Policy Statement 2026, the Ministry of Finance said it plans to develop an accelerator plan for MIP-1.
This comes as 87 percent of interventions have been rolled out, but only 40 percent are on track to achieve their intended outcomes.
Last month, Economics Association of Malawi president Bertha Bangara Chikadza told Times that the 2030 target remains highly challenging due to macroeconomic constraints.
She said Malawi has recorded average growth of 2.7 percent over the past five years, well below the required 6.4 percent.
The 2025 Ecama- NPC budget analysis for the 2025-26 financial year showed insufficient funding for key MIP-1 interventions.
Only 26 percent of the budget was allocated to agriculture, while less than three percent went to tourism and mining combined.
Chikadza said achieving the 2030 goal requires strong commitment and adequate funding for high-impact interventions.
“An accelerator plan can help refocus priorities and improve implementation efficiency, but it is important to recognise that such plans alone cannot produce rapid economic transformation unless supported by strong execution, adequate financing, and structural reforms,” she said.
Scotland-based economist Velli Nyirongo said the accelerator plan signals recognition that the country is off track and needs deliberate intervention.
He said the gap between rolled-out interventions and those progressing as expected points to major implementation weaknesses.
“The proposed accelerator plan could offer a lifeline if it goes beyond rhetoric and prioritises high-impact sectors capable of generating productivity, export earnings and jobs,” Nyirongo said.
He added that agriculture, mining, energy, tourism and digital services require targeted investment and governance reforms to unlock private sector confidence and sustain growth.
