The Reserve Bank of Malawi (RBM) has revised downwards Malawi’s real gross domestic product (GDP) growth projection for 2023 to 1.5 percent from an earlier projection of 1.9 percent.
The revision is contained in the central bank’s 2023 Third Quarter Economic Review.
According to the report, the revision is attributed to lower than anticipated growth in the agriculture, wholesale, retail and manufacturing sectors, stemming from persistent shortages of foreign exchange, high inflation and increased episodes of fuel shortages.
“Meanwhile, stronger growth is expected from the electricity, construction, mining, quarrying accommodation and food services sectors,” the report reads.
Economics Association of Malawi (Ecama) has indicated that the downward revision of the GDP growth is a cause for concern.
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In an interview yesterday, Ecama President Betchani Tchereni said the growth rate remains way lower than the anticipated rate envisioned in Malawi 2063, the country’s long-term development plan.
“For Malawi to achieve the agenda, the economy needs to be growing by over 6 percent annually but since its implementation, the economy has not even grown with half of that, which means the country needs to do more to achieve the agenda,” he said.
Minister of Finance and Economic Affairs Simplex Chithyola Banda expressed optimism that the economy would peak up in the short to medium terms.
Chithyola Banda said having successfully negotiated for the ECF with the IMF and budget support with all other development partners, the government is already addressing the forex, fuel, food and fertiliser scarcity concerns.
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“The government will continue with reforms in order to sustain the economic recovery and if we want to recover, we must do radical reforms and there is no alternative to reforms; a do-nothing scenario will only get the economic situation worse,” he said.
This year has been tough for the Malawi economy, having faced different disturbances such as shortage of foreign exchange, which affected a lot of other factors.
