Africa-Press – Malawi. Malawi’s foreign exchange reserves declined to $521 million in May 2025, down from $591.51 million recorded in June 2024, raising concerns over the country’s ability to finance imports.
A financial market update published by Bridgepath Capital Limited shows an erosion of reserves over the past year, with the reserves falling below the $530 million mark for the first time since November 2024.
The reserves peaked at $591.51 million in June 2024 before experiencing a gradual decline, dropping to $572.02 million by July 2024, with a continued downward trend thereafter.
The reserves position showed some recovery in November 2024, rising to $516.9 million, before climbing to $530.9 million in December 2024 and reaching $570.60 million in January 2025.
However, the upward trend was short-lived, with the reserves dropping to $569.5 million in February 2025, $536.0 million in March, and $530.0 million in April before reaching $521 million in May.
This means that for the past year, the country has not been able to reach the internationally recommended three months import cover threshold.
The declining reserves come at a time Malawi faces mounting pressure to finance essential imports including fuel, fertiliser, and medical supplies.
Economist Marvin Banda said low revenue from tobacco has affected forex generation.
“It should be an indication enough that serious policy intervention is required to balance the BoP,” Banda said.
In a recent interview, Reserve Bank of Malawi spokesperson Boston Maliketi Banda said the central acknowledges the importance of diversifying exports beyond tobacco.
He said they are seeing potential in products like tea and macadamia nuts, as well as mining and tourism.
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