The African Development Bank (AfDB) has downgraded Malawi’s 2025 growth outlook to 2.2 percent from the May 2025 projection of three percent.
Malawi is among the region’s 13 countries projected to post lower growth rates than in the previous forecast period.
Other notable downgrades include Eswatini from 6.5 percent to 4.3 percent, Botswana from 0.8 percent to –0.8 percent, Mozambique from 2.7 percent to two percent and Angola from three percent to 2.5 percent.
In its November 2025 Africa’s Performance and Outlook Macroeconomic Update, AfDB said the lower projections are due to contracting government revenue and widening fiscal deficits.
Reads the update in part: “In addition, global trade policy uncertainties are likely to continue shaping international trade dynamics, demand for Africa’s exports, its external positions, and hence its growth.
“Structural weaknesses and institutional inefficiencies that affect large parts of the continent could weaken the growth outlook.”
Last week, Treasury also revised downward Malawi’s growth from an estimate of 2.8 percent in May 2025 to 2.7 percent in November 2025.
Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha said in his 2025/26 Mid-Year Budget Statement that “the downward revision is on account of shortage of foreign exchange and fuel, which have consequently constrained growth in some key sectors of the economy such as manufacturing and, wholesale and retail.”
He, was, however hopeful that the economy will rebound by 3.8 percent in 2026 and 4.9 percent in 2027 through improvements and investment in agriculture, tourism, mining, manufacturing and digitalisation.
In recent years, Malawi has been hit by major disasters—Cyclone Idai in 2019, Cyclone Ana and Tropical Storm Gombe in 2022, Cyclone Freddy in 2023, and El Niño–induced droughts in 2024—while food price inflation worsened hardship.
Consequently, economic growth has averaged 2.2 percent, far below the recommended 10.6 percent required to grow the economy to a lower middle income status by 2030, with a GDP per capita mark of about $1 086 (about K1.9 million) as envisaged in Malawi 2063, the country’s long-term development strategy.
World Bank data shows that Malawi’s gross domestic product (GDP) per capita stands at $602.3 (about K1 million) as of 2023, far below that of the lower middle-income economy of $1 146 (about K2 million) and higher income economies of $14 005 (about K25 million).
Centre for Social Concern economic governance officer Agness Nyirongo said to reverse these trends, strengthening the agricultural sector and stabilising the macroeconomic environment is critical.
