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2026-02-13 18:41:38
[Malawi President: Inflation to be Reduced to Below 21% This Year] ⑴ Malawian President Peter Mutharika told parliament on Friday that the government aims to reduce this year's annual inflation rate to below 21%. The aid-dependent southern African nation currently has an inflation rate of 26%, which has remained above 20% since mid-2022. ⑵ Mutharika regained power in the September general election last year, promising to revive the economy after years of crisis. A severe dollar shortage has disrupted imports of fuel, fertilizer, and other necessities. ⑶ Mutharika told lawmakers that the goal is to raise the economic growth rate to 3.8% in 2026 and 4.9% in 2027, compared to only 2.7% when the government took over. ⑷ From an economic perspective, curbing inflation is a prerequisite for restoring import capacity and stabilizing the exchange rate. However, foreign exchange reserves can only cover less than three months of imports, far below the internationally recommended buffer level, posing a practical constraint on policy implementation. (5) The focus going forward is on the progress of negotiations with the International Monetary Fund for new aid, and whether debt restructuring can free up more fiscal space for Malawi to support its economic growth targets.
