Malawi economic growth stunted very highly – Finance Minister Gondwe
Minister of Finance, Economic Planning and Development, Goodall Gondwe has conceded that Malawi is facing economic turmoil following food shortage.
Gondwe said his projection of the economy to rebound from a growth rate of 3.1 percent in 2015 to 5.1 percent in 2016 has failed.
“Growth of economy has been stunted very highly by three percent,” Gondwe said on Friday in an interview monitored on Daybreak Malawi program aired by Capital Radio.
The country’s purse keeper said Malawi’s inflation —a monster that eats into the majority of people’s disposable income—is “high”.
National Statistical Office (NSO) figures show that inflation rate is at 23.6 percent owing to a food deficit and increasing maize prices.
Gondwe said government is in the process of importing more than one million tonnes of maize from Ukraine to fill up the current deficit, hoping that prices of the staple grain on the market will subside.
The Malawi Government Annual Economic Report 2016 projects inflation rate to drop to an average of 19.8 percent this year and an end-period rate of 17.5 percent with food inflation projected at 23.8 percent and non-food inflation at 16 percent.
“Inflation is high, foreign reserves have gone down… It’s catastrophic,” Gondwe said when he painted a gloomy picture on Malawi economy.
Gondwe said “urgent remedies” were needed for Malawi economic recovery.
He nevertheless emphasised that government was working tirelessly to turn things around, without elaborating.
In its annual report of World Economic Monitor entitled ‘Absorbing shocks, building resilience, ` the World Bank attributed the slow growth to the shocks of El Nino powered weather phenomenon.
“The economy will continue to adverse weather effects,” says the report in part.
The World Bank says the recovery process of the economy will continue to be slow, saying it will pick up slowly in 2017.
In its latest Monthly Economic Brief, Nico Asset managers report that Malawi Kwacha lost value by 7.1 percent against the United States dollar in the first eight months of 2016.
According to the Nico outlook, the kwacha will continue to depreciate in the medium to long term on account of existent current account deficits and weak foreign direct investment inflows.
“The Kwacha is expected to continue depreciating as a result of low inflow of foreign currency due to poor performance of the tobacco market sales, low levels of investment and a persistently high inflation rate.
“In the medium to long term, the kwacha is expected to depreciate due to significant current account deficit and weak foreign direct investment inflows despite improved forex reserves,” indicates the report.
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POWELL -WANDIWAZA!!!!MALAWIANS ARE BIG TIME JOKERS.THEY LIKE COMMENTING ON THINGS THAT ARE IRRELEVANT TO THEIR LIVELIHOOD.
(a) MPIRA
(b) GOSSIP STORIES
(c) Love stories
(d) Kumwa pa KAMBA or BWANDIRO OR CHIWAVI
(e) COMPLAINING.
They need to change their mind set and start discussing serious stuff. All the above zosathandiza-kungodyelana ma UNITS.
The only things growing in Malawi are the waistlines of the fat cats in government. As corruption expands the economy contracts. Mr G is totally devoid of ideas, hence no details as to how the economy could recover. Why not substitute the growing of tobacco with the growing of food, since the bottom has fallen out of the tobacco market and the country has to import food? If the President was really serious about his responsibilities, he would replace Mr G and appoint someone with practical ideas on how to grow the economy of Malawi.
You are talking about substituting tobacco, is that the job of Minister of Finance? Growing the economy is the responsibility of commerce and industry, housing, Finance plays a not a very big role, in fact it should be a collective responsibility.
How can one person be responsible for the whole economy? Only in Malawi.
How can we improve if only a few comment on developmental issues. if this was cashgate, love story, or say a religious post, there would be 1,000,000 followers and thousands of comments. We have a lot to be done to improve the situation. our grassroots have no capacity and only ask for “their ancestral share” of national funds that they didnt contribute to. What would be the minimum percentage of dependents (in other words the carrying capacity) that the social budget would support? In Malawi I guess at the moment the dependency syndrome is nearly 90% considering the levels of… Read more »
So why is he still Finance Minister? as old as he is.
17 million people and there is no one capable to come and guide this ship! this is reason Malawian politicians think there is a bloodline dna to leadership of the nation.
Most people forget that people do not apply for ministerial posts. They are protected by the constitution. A President is given power to appoint.
Sometimes I wonder why people complain about Goodall Gondwe, and saying kulibe ena? He did not ask to be minister, how many of you would have turned it down?
At least he is the only one I know of who resigned from a ministerial post.
Wina ndani?
That’s the extent of your contribution? How dull.
Mr.G.Gondwe,you are just wasting your precious time for nothing.In a country where corruption reins high,there is no expectation of tangible economic growth.To say the truth,Malawi has been thrown into hyenas’ jaws and to remove that,we shall need leaders of high calibre of which are none-existence as by now.The leaders we have today,are selfish,down to earth tribalists,regionalists,incompetent,corrupt and illiterates, to them,they cannot live without politics because they do not have any other profession a part from fake PHDs and aboveall,they have never ever fought in anyway or form for freedom struggle of our nation they are just receiving the rewards like… Read more »
from the figures mentioned, I hope with all due respect that he actually does not mean the economy has indeed grown by 1%. It was 3.1% expected to hit 5.1% however that has now been revised down by 3%. Now you can either take the 3% away from the revision or take it away from the start position of 3.1%. So if currently the economy stands at 2.1%, then it means the economy has shrunk by 1%. To be honest, without real effort to contain inflation which is affecting the poor export earning due to devalued kwacha; the situation is… Read more »
Without donor money, you can be sure Malawi will collapse. With DPP ruling, you can be sure no donor will help Malawi’s budget. These are the facts – take or leave them – they are the facts.
My hands are still wide open waiting for a day when I will clap for the finance minister. In 2014 he alluded to that effect.
Gondwe sobering up now. You can’t fool people all the time. The lie catches up with you. When you are completely sober you will tell us the truth which is that because of corruption rampart in you government you have failed to pull the economy out of deep recession. These things work together. Ulesi kuba umbombo nkhwidzi unyopi dyera kupanda chikonda mabodza. All these describe your government. How could you expect success under these conditions. You need people to help you and you lie to the same people you want help from. You live in paradise and continue to burden… Read more »
This octogenarian should be reshuffled. He has run out of ideas to keep Malawi’s economy on its feet. He is impotent on the modern economics. Each and everyday we hear of excuses from him. Does the president think that he is the only one out of the 16 million Malawians who can do the job? Sometimes its good to hire people who are proactive, let these grandfathers go and have more time with their grandchildren. Shame on Malawi