Malawi’s economic recovery faces renewed risks from a possible El Niño threat, with experts warning that a poor agricultural season could fuel inflation, worsen foreign exchange shortages and slow economic growth.
This follows a Department of Climate Change and Meteorological Services warning that Malawi could experience another El Niño this year, a development likely to disrupt rainfall patterns and threaten food security.
In a written response on Tuesday, Centre for Social Concern economic governance officer Agnes Nyirongo said climate shocks remain a major threat to the country’s economic stability because of heavy dependence on agriculture for food, employment and export earnings.
in irrigation. | Nation
She said: “If agricultural production falls because of El Niño, Malawi will face higher food prices, reduced export earnings, deeper foreign exchange shortages and slower economic growth.
“Another climate shock could easily reverse the gains the country has made towards macroeconomic stability.”
However, Nyirongo said accelerating investment in irrigation, climate-smart agriculture, economic diversification and disaster preparedness would be critical to ensuring that climate shocks do not continue to derail Malawi’s long-term growth ambitions.
Her concerns come as Malawi continues to recover from a series of climate-related shocks, including Tropical Storm Ana and Cyclone Gombe in January 2022, Cyclone Freddy in March 2023 and the 2024 El Niño, which repeatedly disrupted economic growth projections.
Economic growth fell from a projected 5.2 percent to 1.2 percent in 2022, from 2.7 percent to 1.5 percent in 2023 and from 3.2 percent to 2.3 percent in 2024, largely due to the effects of weather-related disasters.
Food and Agriculture Organisation estimates show that the 2024 El Niño resulted in losses of about $341 million (K600 billion), equivalent to 2.4 percent of gross domestic product (GDP) while the World Bank has warned that climate change could reduce Malawi’s GDP by between three and nine percent by 2030 if the country does not accelerate adaptation measures.
In a separate interview, Economics Association of Malawi president Bertha Bangara-Chikadza said climate shocks continue to pose a major threat to economic recovery as disruptions in agriculture quickly spread across the wider economy.
“Climate change has become one of the biggest threats to economic growth because any disruption in agriculture affects food prices, export earnings, household incomes and overall economic activity,” she said.
Treasury spokesperson Williams Banda was yet to respond to Business Review questionnaire on how government is preparing to avert the El Nino threat.
But Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha said in the 2026/27 National Budget Statement that the economic outlook remains cautiously positive, with growth expected to be supported by investments in agriculture, tourism, mining, manufacturing and small and medium enterprises.
“This growth will be supported by strategic investments in key productive sectors of agriculture, tourism, mining, manufacturing, and small and medium enterprises. Special focus will be put on increased production and value addition, export diversification and import substitution,” he said.
The Ministry of Finance, Economic Planning and Decentralisation has since projected real gross domestic product growth at 3.8 percent in 2026 and further strengthen to 4.9 percent in 2027 while the World Bank and African Development Bank’s 2.3 percent and 2.9 percent estimates, respectively.
