When I titled my Business Unpacked entry of March 12 2026 ‘Budget targets could be dead on arrival, act now’, I sounded like a prophet of doom, a pessimist and an unpatriotic citizen of our beautiful but economically-distressed republic.
But there was no malice in my sentiments. The assessment was based on global developments following the joint US and Israel attacks on Iran on February 28 2026—barely 24 hours after Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha tabled the K10.9 trillion 2026/27 National Budget in Parliament. The fiscal plan was optimistically themed ‘Driving economic recovery and sustainable growth through impactful reforms and fiscal consolidation.’
In what he described as a “people-centred, pro-poor, developmental and transformative” agenda, the minister stated that the financial plan sought to drive Malawi’s economic recovery by focusing on four key sectors: Agriculture, Tourism, Mining and Manufacturing. He forecast gross domestic product (GDP) to grow from 2.7 percent in 2025 to 3.8 percent in 2026, and further to 4.9 percent in 2027, with the budget itself anchored on a 4.1 percent real GDP growth rate.
Yet, just three months after Parliament approved the fiscal plan, the July 13 2026 edition of The Nation screamed: ‘Budget in peril’. The sub-headlines told the grim story: ‘Three months later, growth, inflation and deficit targets off track’ and ‘Budget committee pushes for urgent recalibration.’ The very economic foundations upon which this fiscal plan was built are already cracking.
The end-year inflation target was pegged at 15 percent, alongside a policy rate of 18 percent and a nominal GDP of K31.5 trillion. But come April, the World Bank trimmed Malawi’s 2026 GDP growth forecast to 2.3 percent. It also warned that inflation would stubbornly stay above the 20 percent mark—five percentage points higher than the government’s ambitious target.
Parliament’s Budget and Finance Committee chairperson, Sosten Gwengwe, could not have put it better: “The legs on which the 2026/27 budget is standing have become very weak and shaky.”
What was presented as a promising blueprint to stabilise the economy is already spinning off the rails. Mwanamvekha’s first budget under the new administration was widely expected to honour the social contract with voters: protecting livelihoods, stabilising prices and delivering services while repairing the macroeconomy.
Instead, Malawians are faced with starkly mixed outcomes. While fallen maize prices have provided some momentary relief at the local market and eased the immediate cost of living, never-ending foreign exchange challenges are rapidly eroding these gains. Chronic forex shortages mean a skyrocketing cost for imported strategic commodities. Most importers openly acknowledge sourcing forex from the parallel market at double the official rate of K1 751 to the dollar.
The fallout from global geopolitical tensions, coupled with the Malawi economy’s p e r e n n i a l s t r u c t u r a l vulnerabilities, has returned to haunt the implementation of the national financial plan. Crucially, this fiscal ghost has struck much earlier than usual. Waiting for the Mid-Year Budget Review in September will be far too late to salvage the situation.
Under Malawi 2063, our long-term development strategy, this country aspires to be “an inclusively wealthy and self-reliant industrialised upper-middle-income country… so that we can fund our development needs primarily by ourselves.” This vision is driven by three pillars: agricultural productivity and commercialisation, i n d u s t r i a l i s at i o n and urbanisation. Today, that target looks like a tall order in the face of such paltry economic growth rates.
National budgets lay out a government’s true agenda. They are meant to guide the implementation of development plans that foster prosperity and reduce poverty. Ultimately, a budget represents a foundational contract between a government and its citizens. But when national budgets fail, governments fail too. That is how serious this issue is.
In the run-up to the September 16 2025 General Election, President Peter Mutharika and the Democratic Progressive Party may not have specifically promised to take Malawians to the biblical Promised Land of Canaan—as did their now-defunct Tonse Alliance rivals in 2020—but they did promise better economic fortunes.
To be the modern-day Moses (Mose wa lero) who can deliver Malawians from the jaws of poverty, Mutharika and his team must offer genuine assurance. They must channel Moses in Exodus 14:13, who told the terrified Israelites: “Stand firm and you will see the deliverance the Lord will bring you today. The Egyptians you see today you will never see again.”
News of this budget going off track so quickly simply reactivates my long-held fears. My excitement over national budgets faded over the past decade because our financial plans have been reduced to mere talk shows and political roadshows—arenas where successive ministers of Finance make grandiose promises but fail to deliver.
Barack Obama, the 44th President of the United States, once aptly defined a budget perfectly: “A budget is more than just a series of numbers on a page. It is an embodiment of our values.”
Every time our budget goes off track, that sentiment should trouble our collective conscience. A budget is a sacred social contract meant to deliver tangible results—not excuses and certainly not a repetitive cycle of what can be perceived to be ‘promises and lies.
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