Government urged to prioritise economic diversification
The Malawi government needs to prioritise diversifying the economy and efficient use of budget resources to put the economy back on track to achieve development targets, experts have advised.
The advice follows Malawi’s drop by three places from 169 in 2021 to 172 in 2022 on the Human Development Index (HDI) released by the United Nations Development Programme.
The Human Development Report observed that Malawi’s HDI score, a statistical composite index of life expectancy, education and per capita income indicators, dropped from 0.509 in 2021 to 0.508 in 2022, placing Malawi in the low human development category.
Figures from UNDP show Malawi’s gross national income per capita has dropped from $1 456.10 in 2021 to $1 432.47 in 2022.
The declines in the indicators seem marginal, but the drop in the ranking suggests that Malawi is lagging behind its peers on performance on the key indicators in health, education and income inequalities.
Reacting to the report, Catholic University of Malawi economics lecturer Derrick Thomo said the slump means that it will be “a challenge, but not impossible for Malawi” to meet the United Nations Sustainable Development Goals (SDGs), which are supposed to be achieved by 2030.
That is also the same year Malawi is supposed to attain the lower middle income status as outlined in Malawi 2063, the country’s long-term development plan.
On the mitigating factors, Thomo said the government should focus on diversifying its economy from its traditional agricultural base, to boost the country’s resilience to external shocks.
“Further, the government should improve healthcare access to further enable rural dwellers to have more access to health facilities and invest in education as well as skills training and promoting sustainable environmental conservation practices,” he said.
Asian-based Malawian economic statistician Alick Nyasulu said Malawi has regressed on several key economic indicators because of the exogenous shocks that rocked the country in the past five years, including the Covid-19 pandemic, Cyclone Freddy and the Russia-Ukraine war.
To bring the economy back on track, he urged the government to prioritise the efficient use of budget resources into key social sectors such as education and health as well as economic sectors such as transport, energy and water to improve the quality of life for Malawians.
“Malawi’s HDI rating is the lowest since 2017 when it scored 0.505. The rank is also the lowest since 2015, when the country was ranked 172, the same as 2022.
