The International Monetory Fund (IMF) has projected that Malawi’s 2012/2013 Gross Domestic Product (GDP) will grow by 4.3 percent and 5.7 percent respectively.
The IMF indicated its focus in its October 2012 regional economic outlook report for Malawi just at the moment when economic authorities in the country have pegged the country’s GDP growth projection at 1.6 percent due to contractions in the Agricultural and manufacturing sectors.
According to the IMF Report, Malawi’s total investment is expected to increase to 16.5 percent of GDP this year, up from 15.55 percent of GDP in 2011.
Meanwhile Government’s debt, as a percentage of GDP, is at 49 percent, almost half of the total value of the goods and services produced this year.
Gross domestic product GDP is the market value of all officially recognized final goods and services produced within a country in a given period.
The country’s manufacturing industry has of late been struggling due to intermittent blackouts of electricity and erratic water supply. The problem was also compounded by a shortage of foreign currency and fuel.
The Malawi Kwacha depreciated last week by 0.8 percent to trade at MK309.10 against the US Dollar, up from MK 306. 70
IMF’s projection comes at the time Finance Minister, Ken Lipenga assured the nation that the country’s economy will bounce back to its former glory.
Lipenga said as long as the country stick to its policies currently under implementation, the economic situation would improve.
“I confidently say that the economy will rebound to a growth rate of 5.5 percent come 2013. The growth rate has had to be adjusted downwards now for the reason that we have given but we know that there would be more tobacco next year and that there will be more forex will be available.”
Malawi is still experiencing shortages of foreign exchange and fuel which continue to greatly affect various business operations in the country.
The Joyce Banda administration made several economic reforms soon after coming into power, including a devaluation of the local currency the Kwacha by 48.18 percent.Follow and Subscribe Nyasa TV :