International Monetary Fund forecasts 4 percent economic growth for Malawi

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The International Monetary Fund (IMF) said it expects Malawi’s economy to grow by about 4 percent in 2019. The international organisation also expects the country’s economic growth to rise to 6 or 7 percent over the medium term.

A statement released by the IMF revealed that Malawi was performing well under a three year $112 million loan facility approved in early 2018 to help the country reform its economy. The statement which read “Malawi’s economy continues to grow while inflation remains on a declining trend”, was noted by the IMF to show how the country has restored economic stability after donors froze budgetary support over a corruption scandal.

Malawi is heavily reliant on foreign funding and has a third of it’s $3.5 billion debt from external sources. According to the IMF, the key reform areas for Malawi are debt management and public financial management. The organisation notes that the country’s fiscal policy should focus on ways to restore the budget balance after spending overruns in 2017.

Economic pressures also drove Malawi’s energy regulator to announce an average of 5 percent hike on fuel prices. The regulator ran out of funds to continue substituting fuel price for consumers.

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