By Burnet Munthali
Africa-Press – Malawi. Our senior contributor Burnet Munthali is taking us through on economic growth between two nations; Malawi and Zimbabwe in 2023 for the citizens to appreciate how their leaders are either making headways to uplift livelihoods.
Malawi Economic Growth
Food Security
According to statistics in August 2022, between October 2022 and March 2023, the situation was expected to deteriorate, with 3.8 million people in Malawi (20% of the population) expected to face high levels of acute food insecurity (IPC Phase 3), an increase by 8% compared to the current period.
Economic Outlook
Malawi’s economic outlook for 2023 is poor. The forecast has been maintained that real GDP growth will slow to just 0.7% in 2023. This is down from estimated growth of 1.0% in 2022, and from a projection prior to Cyclone Freddy of 3.7%.
GDP Growth Rate
GDP growth is growth rate is projected to rebound to 2.0% in 2023 and 3.5% in 2024, driven by a recovery in agriculture, tourism and exports, and foreign direct investment. Headwinds include weather-related shocks and the prolongation of Russia’s invasion of Ukraine.
Economic Overview
The economic situation in 2022 in Malawi was that GDP growth was projected to decline to 0.9% in 2022, from 2.8% in 2021, with lower agricultural output, erratic electricity supply, forex shortages affecting the importation of raw materials, and high global commodity prices. Economic growth is projected to slightly increase in 2023 but remains subdued.
GDP Ranking
Worldwide gross domestic product in 2021 was at about 12,183 USD per capita. GDP in Malawi, on the other hand, reached USD 635 per capita, or 12.63 billion USD for the whole country. Malawi is one of the smaller economies and was at that time ranked 139.
GDP Ranking
Zimbabwe is holding 101 positions by nominal GDP. Its national debt in 2021 was 18,175 million euros (1,905,213 million dollars), ( 59.81% debt-to-GDP ratio) and its public debt per capita is €1,136 euros per inhabitant$119,124 dollars per inhabitant.
Zimbabwe Economic Growth
Findings of the 2023 Crop, Livestock, and Fisheries Assessment Report (CLAFA – 2) indicate that the country will be cereal self-sufficient during the current consumption year (April 2023 – March 2024) following an expected cereal bumper harvest of approximately 2,300,000 MT of maize and 281,000MT of small grains against.
Economic Growth
Real GDP growth is projected to recover to 3.2% in 2023 and 2024, anchored largely by agriculture, mining, and services. Tight monetary and fiscal policy is expected to increase macroeconomic stability in 2023.
Current Economic Situation
According to a report released in March 2023, The current economic situation in Zimbabwe is that real GDP growth is estimated to have slowed to 3.4% in 2022 from 8.5% in 2021 on the back of worsening agriculture conditions and macroeconomic instability. Due to low rainfall, agricultural output contracted by 14%, after growing at double digits in 2021.
Inflation
Zimbabwe’s annual consumer price inflation skyrocketed to 175.8% in June 2023, up from 86.5% in the prior month, marking a continued deviation from the downward trend observed since the beginning of the year.
Biggest Economic Activity
Zimbabwe’s economy depends heavily on its mining and agriculture sectors. While agriculture remains vulnerable to climate shocks in the country, the sector experienced significant growth in 2022 and recorded the highest wheat harvest in 56 years. The mining industry dominates the industrial sector.
Best Economic System
Zimbabwe has a mixed economy in which there is limited private freedom, but the economy remains highly controlled by the government. Zimbabwe is a member of the Common Market for Eastern and Southern Africa (COMESA) and the Southern African Development Community (SADC).
Monetary Policy
Monthly blended inflation is expected to average below 1.5% in 2023. Annual blended inflation is expected to decline progressively to reach 10%-30% by year-end. Policy rates are expected to be aligned to the implied ZW$ inflation path and end the year 2023 between 30%-60%.
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