02:37 am - Wednesday 21 November 2018

Malawi’s Economy in the right direction

By Amalawi - Sun Oct 12, 8:15 pm

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Malawi: Strides towards a possible rebound for Malawi’s fragile economy look shining with a possible further growth in the short to medium term.

2014 Malawi’s Annual Economic Report projects a 5.8 percent growth rate next year, although slightly lower than this year’s 6.1 percent estimate.

“In 2015, the economy is projected to continue performing well and it is anticipated to register a growth rate of 5.8 percent,” indicates the Malawi government’s budget document number 2, which outlines local
economic trends.

This is owing to a possible growth in businesses and restored confidence that major microeconomic fundamentals such as inflation and exchange rate will improve in the economy.

Sector by sector growth rate projection also indicate to tally its growth rate with the economy at large.

The manufacturing sector is projected to grow by 3.8 percent, while the construction sector is to rise by 6.0 percent.

Local transport sector is to improve by 5.2 percent.

However, the mining sector would moderately grow by 2.2 percent, a drop from this year’s 7.8 percent projection owing to moderate growth in traditional mineral outputs.

Finance Minister Goodall Gondwe

Finance Minister Goodall Gondwe

“It is however possible that the actual attained level may be considerably higher if Paladin resumes production of Uranium at Kayerekera or if significant investment are made in the sector following the conclusion of the Geo-Physical Airborne survey,” indicates the ministry of finance report.

In 2013, Malawi attained a GDP growth of 6.1 percent owing to positive growth rate registered by at least all sectors of the economy.

However, the contraction in fiscal expenditure in the last quarter of that year, high interest rates, increased cost of materials and power blackouts remained major challenges for businesses.

Malawi’s economy remains fragile amidst suspended budget support from development partners which is crucial for growth

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