Malawi has a long way to go on industrialisation—a key pillar for attaining middle-income-economy status under the Malawi 2063 vision.
This is according to the 2025 Real Economic Development (RED) Index report, which shows that out of the 55 African countries, only Morocco, Egypt, South Africa and Mauritius have established the necessary foundations for large-scale industrialisation.
This means Malawi, alongside other economies, still lacks the structures required to meet the demands of high-scale industrialisation.
The annual RED report, published by the Business Council for Africa (BCA), indicates that most African countries are either stalled or vulnerable in their industrialisation efforts due to persisting structural challenges.
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Despite many governments across the continent adopting ambitious industrial development agendas, the report says progress continues to be constrained by weak infrastructure, governance challenges, limited productivity and slow economic transformation.
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Malawi also seeks to transform its economy through industrialisation under the Malawi 2063 vision but progress has remained slow, as reflected in the country’s subdued economic growth of 2.7 percent in 2025 and weak manufacturing sector performance whose growth has averaged about 2 percent for years.
In 2026, Malawi’s economic growth is projected to improve slightly to 3.8 percent.
However, the projected outturn remains below the annual growth target of 6 percent set under Malawi 2063 for the country to attain middle-income status.
The manufacturing sector, which is central to industrial growth, continues to struggle with structural constraints such as chronic foreign exchange shortages affecting the importation of raw materials, high production costs and low productivity.
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The National Planning Commission (NPC)—a State-funded entity responsible for crafting and overseeing implementation of long-tern national development plans—says Malawi needs a comprehensive strategy for structural transformation if it were to achieve meaningful industrialisation.
NPC Director General Fredrick Changaya said the country must make a deliberate decision to industrialise and maximise the efficient use of available resources, including land, to generate greater economic benefits.
“We must be deliberate and intentional in deciding the level of industrialisation and value addition we want to pursue, and in which sectors,” Changaya said.
Economist Marvin Banda said the findings merely highlighted challenges that have long affected Malawi’s economy.
“This report does not tell us what we don’t already know. While other countries have spent years laying the groundwork for industrialisation, Malawi is nowhere near being structurally ready. No amount of slogans under Malawi 2063 or MIP-1 can change that reality,” Banda said.
He warned that without meaningful industrial growth, Malawi risked “growing poor people, not prosperity”.
Banda cited unreliable electricity supply, high transport costs, foreign exchange shortages, policy reversals and low productivity as some of the major constraints affecting the manufacturing sector.
“No economy is built on power cuts, fuel queues and inflation surprises. Industrialisation is not an aspiration; it is an outcome of discipline,” he said.
