Malawi’s persistent foreign exchange shortages will remain a major constraint on economic stability.
Economists have since warned that unless the economy expands to sustainable forex-generating sectors such mining and tourism, the challenge will persist The warning comes as the Reserve Bank of Malawi (RBM) latest Monthly Economic Review showed the country’s forex reserves declined to $571.6 million (about K999 billion) in March 2026 from $625.7 million (about K1 trillion) in February, reducing import cover from 2.5 months to 2.3 months.
It reads: “The outturn was due to a decline in both gross official and private-sector reserves. Meanwhile, the outcome in the review month was higher compared to $536 million [about K938 billion] recorded in the corresponding month of 2025.”
Scotland-based Malawian economist Velli Nyirongo cautioned that the modest improvement from the $536 million recorded in March 2025 should not be overinterpreted.
“The economy, therefore, remains exposed rather than fully stabilised,” he said.
Nyirongo said weak reserves continue to expose Malawi to fuel supply disruptions, exchange rate pressures and inflation because the economy remains heavily dependent on imports for fuel, fertiliser, medicines and industrial inputs.
“Rising inflation would in turn reduce household purchasing power and increase the cost of doing business,” he said.
Mzuzu University economics lecturer Christopher Mbukwa argued in an interview on Tuesday that Malawi needs more aggressive supply-side reforms focused on exports, mining, tourism, remittances and investment inflows.
“It is only through increased forex supply through exports growth or investor inflows that we can have a natural rate of forex on the market,” he said.
Mbukwa further warned that attempts to regulate the forex market without improving forex generation could strengthen the parallel market and weaken export incentives.
The impact of forex shortages is now increasingly spreading beyond fuel and industrial imports into the digital economy.
Briefing the Parliament’s Government Assurances and Public Sector Reforms Committee last week, Malawi Communications Regulatory Authority (Macra) director general Mayamiko Nkoloma said forex shortages were delaying telecommunications infrastructure upgrades and worsening network congestion.
“Most of the challenges are coming in due to forex challenges,” he said.
Nkoloma said Airtel Malawi plc and TNM plc each require between $30 million (about K52 billion) and $40 million (about K70 billion) to upgrade network infrastructure and improve service quality.
He said Macra is lobbying the Reserve Bank of Malawi and the Ministry of Finance, Economic Planning and Decentralisation to prioritise information and communications technology in forex allocation to support telecom infrastructure imports.
