Economic and Political Overview

flag Malawi Malawi: Economic and Political Overview

In this page: Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline | COVID-19 Country Response


Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Compared to other countries, Malawi's economy proved to be resilient to the Covid-19 crisis, mainly thanks to the dominant role played by the agricultural sector. Nevertheless, after a tepid rebound in 2021, Malawi’s economy entered another slowdown in 2022, when GDP grew an estimated 0.9% due to external shocks (particularly the global impacts of the Russia-Ukraine war) and a worsening balance-of-payments crisis caused by sustained fiscal and external imbalances. Economic growth is likely to be below the regional growth rate in 2023: the IMF forecasts a 2.5% growth rate for the year driven by a better agricultural season and a gradual recovery in the services and industry sectors, followed by a slight acceleration to 3.2% in 2024.

Malawi's financial situation deteriorated due to the Covid-19 pandemic, as the balance of payment and fiscal needs increased in the midst of declining revenues. In response to the health crisis, the authorities adopted measures including strengthening the health care system, stepping up social spending, ensuring food security, and easing liquidity constraints in the banking system (IMF). According to the World Bank, the fiscal deficit reached 8.8% of GDP in FY2021/22, up from 8% one year earlier, while the public debt was estimated to have reached 73.3% of GDP by the end of 2022 (IMF). The country has a heavy interest burden and almost a third of domestic revenue will be needed for interest expenditure alone in FY2022/23. Meanwhile, in November 2022, the Executive Board of the IMF approved a disbursement of USD 88.327 million under the Food Shock Window of the Rapid Credit Facility to help Malawi address urgent balance of payment needs related to the global food crisis. Moreover, Malawi’s balance of payment worsened over the course of 2022, with foreign exchange widely unavailable: gross foreign exchange reserves decreased from USD 847 million in December 2019 to USD 326 million in October 2022, roughly covering 1.3 months of imports, much lower than the recommended adequacy level of 3.9 months of import coverage for a credit-constrained economy (World Bank). The inflation rate spiked over the course of 2022, driven by high global prices of food commodities and energy, coupled with the 25% devaluation of the national currency in May 2022 that amplified the impact of the elevated international prices. The IMF estimated the inflation rate at 18.4% in 2022, with a marginal decrease projected for 2023 (16.5%) and 2024 (12.6%), well above the Central Bank’s target range (3 to 7%). In the long term, President Chakwera’s Malawi Vision 2063 programme aims for the country to reach upper-middle income status by 2063 by investing in physical and human capital (IMF).

In Malawi, poverty has been increasing in rural areas where 85% of the population lives, compared to urban areas where it fell significantly from 25% to 17%. While no reliable figures are available for the unemployment rate, the World Bank estimates that over half of the Malawian population (50.7%) lives in poverty, with one of the lowest GDP per capita (PPP) in the world, estimated at USD 1,588 in 2022 (IMF). Other challenges include addressing scarce skilled human resources, providing healthcare, and managing population growth. The country has made progress in combating AIDS, although 10% of the population is HIV-positive.

Main Indicators 202020212022 (E)2023 (E)2024 (E)
GDP (billions USD) 11.8512.4612.5111.2810.89
GDP (Constant Prices, Annual % Change)
GDP per Capita (USD) 568580566496466
General Government Gross Debt (in % of GDP) 54.861.670.172.269.4
Inflation Rate (%) 8.69.320.824.718.3
Current Account (billions USD) -1.63-1.57-0.45-1.38-1.45
Current Account (in % of GDP) -13.8-12.6-3.6-12.3-13.3

Source: IMF – World Economic Outlook Database , Latest available data

Note: (e) Estimated Data

Main Sectors of Industry

With about 80% of the population living in rural areas, the economy of Malawi is predominately agricultural: the primary sector is estimated to account for 22.7% GDP, 80% of export revenues and 76% of employment (World Bank, latest data available). The main export and most cultivated crop is tobacco, while other revenue-generating crops include corn (maize), tea, coffee, sugarcane, cotton, sorghum, and potatoes. Historically, the country produces enough food to feed its population, though harvests can be seriously affected by adverse weather conditions, like it was the case in 2015 and 2016 with El Nino-induced droughts. As an example, Malawi's maize output - the major food crop - decreased by 18.9% in the 2021/22 farming year (to 3.7 million metric tonnes) due to drought, tropical cyclones and a lack of subsidized fertilizer. In 2022, the total agricultural output decreased by 1% and seasonal production estimates indicate that Malawian farmers harvested 5% less maize and 37% less tobacco than the average for the three preceding seasons (World Bank).

Though still underdeveloped, the industrial sector contributes an estimated 18.4% of GDP, employing only 5% of the workforce. Though still underdeveloped, the industrial sector contributes an estimated 18.5% of GDP in 2020. The majority of Malawi's industrial activity comes from manufacturing and food processing. Despite the government’s efforts to boost competitiveness, several challenges kept hindering the sector, including poor business climate, a lack of well-developed infrastructure, and the shortage of skilled labour to operate machinery. Mining activities are at a small-scale level, since Malawi has no oil or precious metals (except for ruby). However, the country has some deposits of bauxite, asbestos, graphite, and uranium. The latest estimates by the Reserve Bank of Malawi (RBM) show that the manufacturing sector expanded by 4.7% in 2022, whereas the mining and quarrying sector grew an estimated 4.6%, mainly on account of anticipated resumption of uranium mining at the Kayelekera Uranium Mine.

The services sector is the major contributor to the economy, accounting for more than half of GDP (52.4%). The main activities include tourism, health services, the banking sector, telecommunications, and retail, with the government of Malawi holding significant shares in most of these sectors. The tertiary sector employs 18% of the workforce. Tourism is considered a priority economic sector in the country’s long term development plan “Malawi Vision 2063”: prior to the COVID-19 pandemic, the sector accounted for more than 525,000 jobs, representing almost 7% of overall employment. After plummeting due to the pandemic, tourist arrival numbers recovered in 2022: in the first seven months of the year, the number of tourists increased by 62.7% compared to the same period one year earlier (to 722,133 – data National Bureau of Statistics).

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 76.4 5.4 18.3
Value Added (in % of GDP) 22.7 18.4 52.4
Value Added (Annual % Change) 5.2 1.9 2.0

Source: World Bank - Latest available data.


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Monetary Indicators 20162017201820192020
Malawi Kwacha (MWK) - Average Annual Exchange Rate For 1 MUR 20.0821.1821.5821.0119.05

Source: World Bank - Latest available data.


Find out all the exchange rates daily on our service Currency Converter.

Indicator of Economic Freedom


The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

World Rank:
Regional Rank:

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation


Country Risk

See the country risk analysis provided by Coface.


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Foreign Trade in Figures

Malawi is relatively open to international trade: the country is a member of the WTO and has bilateral trade agreements with two of its main trade partners, South Africa and Zimbabwe. Malawi is also a beneficiary of the African Growth and Opportunity Act (AGOA), a U.S. trade preference program. As part of its trade policy, the country has been gradually reducing protections granted to domestic trade by shifting its sources of revenue from customs duties to consumption and direct taxes. Overall, Malawi's economy remains heavily dependent on agriculture, and its exports and imports reflect this reliance on primary and intermediate goods: tobacco accounts for more than half of total exports, as the country is one of the world's largest producers of tobacco. Other major exports include tea, sugar, and agricultural products in general. Imports are led by refined petroleum (7.2% of total imports), machinery, transport equipment, fertilizers and medicaments.

According to the latest data available by Comtrade, the main export destinations of Malawi are Belgium (20.8%), South Africa (6.2%), the United Kingdom (6%), Kenya (5.1%), the United States (4.6%), Zimbabwe (4.5%), China (4.4%) and Tanzania (4.3%). The top import origins are South Africa (20.6%), China (16.2%), the United Arab Emirates (10.1%), India (7.7%), the United Kingdom (4.6%) and Zambia (4.4% - data 2021).

Malawi’s trade balance is structurally in deficit. In 2021, imports of goods reached USD 3.2 billion, while the country exported goods for a value of USD 1 billion (+15.5% and +31.3% year-on-year, respectively – data WTO). The trade deficit has been contracting in recent years, a trend that was exacerbated in 2022 as imports collapsed reflecting the impact of foreign exchange shortages. While alleviating the external balance, the unavailability of foreign exchange led to shortages of imported goods (World Bank).

Foreign Trade Indicators 20172018201920202021
Imports of Goods (million USD) 2,5472,7062,9412,8203,257
Exports of Goods (million USD) 8848809137671,007
Imports of Services (million USD) 3013023372750
Exports of Services (million USD) 1301601751620
Trade Balance (million USD) -1,577-1,658-1,733-1,797-1,914
Trade Balance (Including Service) (million USD) -1,737-1,819-1,819-1,940-2,043

Source: WTO – World Trade Organisation ; World Bank , Latest Available Data


Main Partner Countries

Main Customers
(% of Exports)
Belgium 13.8%
India 7.6%
Tanzania 7.0%
South Africa 6.6%
United Arab Emirates 4.6%
See More Countries 60.5%
Main Suppliers
(% of Imports)
China 18.2%
South Africa 17.8%
United Arab Emirates 9.3%
India 7.3%
Zambia 4.2%
See More Countries 43.2%

Source: Comtrade, Latest Available Data


Main Products

1.0 bn USD of products exported in 2021
Unmanufactured tobacco; tobacco refuseUnmanufactured tobacco; tobacco refuse 44.3%
Soya beans, whether or not brokenSoya beans, whether or not broken 10.7%
Cane or beet sugar and chemically pure sucrose, in...Cane or beet sugar and chemically pure sucrose, in solid form 7.4%
Tea, whether or not flavouredTea, whether or not flavoured 7.1%
Dried leguminous vegetables, shelled, whether or...Dried leguminous vegetables, shelled, whether or not skinned or split 6.2%
See More Products 24.2%
3.1 bn USD of products imported in 2021
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 7.9%
Unused postage, revenue or similar stamps of...Unused postage, revenue or similar stamps of current or new issue in the country in which they have, or will have, a recognised face value; stamp-impressed paper; banknotes; cheque forms; stock, share or bond certificates and similar documents of title 7.3%
Mineral or chemical fertilisers containing two or...Mineral or chemical fertilisers containing two or three of the fertilising elements nitrogen, phosphorus and potassium; other fertilisers (excl. pure animal or vegetable fertilisers or mineral or chemical nitrogenous, phosphatic or potassic fertilisers); animal, vegetable, mineral or chemical fertilisers in tablets or similar forms or in packages of a gross weight of <= 10 kg 5.3%
Human blood; animal blood prepared for therapeutic...Human blood; animal blood prepared for therapeutic, prophylactic or diagnostic uses; antisera and other blood fractions and immunological products, whether or not modified or obtained by means of biotechnological processes; vaccines, toxins, cultures of micro-organisms (excl. yeasts) and similar products 4.5%
Mineral or chemical nitrogenous fertilisers (excl....Mineral or chemical nitrogenous fertilisers (excl. those in pellet or similar forms, or in packages with a gross weight of <= 10 kg) 3.6%
See More Products 71.4%

Source: Comtrade, Latest Available Data


To go further, check out our service Import Export Flows.


Main Services

Source: United Nations Statistics Division, Latest Available Data

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Sources of General Economic Information

List of Malawi's Ministries
Statistical Office
National Statistical Office of Malawi
Central Bank
Reserve Bank of Malawi
Stock Exchange
Malawi Stock Exchange
Search Engines
Google Malawi
Biz Malawi
Economic Portals

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Political Outline

Current Political Leaders
President: Lazarus Chakwera (since 28 June 2020)
Vice President: Saulos Chilima (since 3 February 2020)
Next Election Dates
Presidential Election: 2025
National Assembly: May 2024
Main Political Parties
Malawi is a multi-party state system. The main political parties include:

- Malawi Congress Party (MCP): centre-right (current President Lazarus Chakwera belongs to the MCP)
- United Transformation Movement (UTM): centre to centre-right
- Democratic Progressive Party (DPP): liberal
- United Democratic Front (UDF): centre-left
- People's Party (PP): centre-right
- Alliance for Democracy (AFORD): centre-left.
Type of State
Malawi is a presidential republic.
Executive Power
Th executive power is exercised by the government. The President of Malawi, elected through universal direct suffrage every 5 years, is both chief of state and head of the executive power. The President appoints his Cabinet, whose members can be drawn from either within or outside of the Parliament.
Together with the President, a vice-president is elected. The president can choose to appoint a second vice president, who must be from a different party.
Legislative Power
Legislative power is vested in the Parliament, which under the Constitution has two chambers: the National Assembly - with its 193 members elected for a five-year term in single-seat constituencies - and the Senate - which was originally meant to have 80 seats and had to represent traditional leaders, different geographical districts and special interest groups (such as women, the disabled, young people), but which has never been created.

Indicator of Freedom of the Press


The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:

Indicator of Political Freedom


The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Partly Free
Political Freedom:

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House


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COVID-19 Country Response

Travel restrictions
Regularly updated travel information for all countries with regards to Covid-19 related entry regulations, flight bans, test and vaccines requirements is available on TravelDoc Infopage.
To find information about the current travel regulations, including health requirements, it is also advised to consult Travel Regulations Map provided and updated on a daily basis by IATA.
Import & export restrictions
A general overview of trade restrictions which were adopted by different countries during the COVID-19 pandemic is available on the International Trade Centre's COVID-19 Temporary Trade Measures webpage.
Economic recovery plan
For the general overview of the key economic policy responses to the COVID-19 pandemic (fiscal, monetary and macroeconomic) undertaken by the government of Malawi, please consult the country's dedicated section in the IMF’s Policy Tracker platform.
Support plan for businesses
For an evaluation of impact of the Covid pandemic on SMEs and an inventory of country responses to foster SME resilience, refer to the OECD's SME Covid-19 Policy Responses document.
You can also consult the World Bank's Map of SME-Support Measures in Response to COVID-19.


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Latest Update: September 2023