The International Monetary Fund (IMF) says Malawi is facing serious economic difficulties, including unsustainable debt, high inflation, and dangerously low foreign reserves.

In its 2025 Article IV Consultation Report, the IMF reveals that Malawi’s public debt has soared to 88% of GDP, while domestic borrowing costs continue to rise.

IMF also notes that real GDP growth slowed to 1.8% in 2024, with only a slight recovery to 2.4% expected in 2025 under current policies.

"The authorities are more optimistic about the economic outlook," the IMF states, adding that Malawi projects 3% GDP growth this year despite ongoing challenges.

However, the IMF has warned of serious risks if reforms are not urgently implemented, including fiscal tightening, improved debt management, and exchange rate flexibility.

“Malawi is at a critical juncture facing high inflation, an unsustainable fiscal and debt outlook, foreign exchange shortages, and fuel scarcity,” the IMF Executive Board said in its assessment.

The report also shows that inflation peaked at 30.7% in early 2024 and remains a major concern, with the IMF urging tighter monetary policy to stabilize prices and restore investor confidence.

Meanwhile, economic expert Abel Mwenibanda says Malawi has sound economic policies but lacks the political will to implement them.

He suggests that increased investment in mining and agriculture could help turn around the country's economy in the shortest time.

(Written By: Blessings Mbewe)