Malawi Economy Profile 2009

Economy - overview

Landlocked Malawi ranks among the world's most densely populated and least developed countries. The economy is predominately agricultural with about 85% of the population living in rural areas. Agriculture accounts for more than one-third of GDP and 90% of export revenues. The performance of the tobacco sector is key to short-term growth as tobacco accounts for more than half of exports. The economy depends on substantial inflows of economic assistance from the IMF, the World Bank, and individual donor nations. In December 2007, the US granted Malawi eligibility status to receive financial support within the Millennium Challenge Corporation (MCC) initiative. Malawi will now begin a consultative process to develop a five-year program before funding can begin. In 2006, Malawi was approved for relief under the Heavily Indebted Poor Countries (HIPC) program. The government faces many challenges including developing a market economy, improving educational facilities, facing up to environmental problems, dealing with the rapidly growing problem of HIV/AIDS, and satisfying foreign donors that fiscal discipline is being tightened. In 2005, President MUTHARIKA championed an anticorruption campaign. Since 2005 President MUTHARIKA'S government has exhibited improved financial discipline under the guidance of Finance Minister Goodall GONDWE and signed a three year Poverty Reduction and Growth Facility worth $56 million with the IMF. Improved relations with the IMF lead other international donors to resume aid as well.

GDP (purchasing power parity)

$11.81 billion (2008 est.)
$10.87 billion (2007 est.)
$10.07 billion (2006 est.)
note: data are in 2008 US dollars

GDP (official exchange rate)

$4.268 billion (2008 est.)

GDP - real growth rate

8.6% (2008 est.)
7.9% (2007 est.)
8.2% (2006 est.)

GDP - per capita (PPP)

$800 (2008 est.)
$800 (2007 est.)
$800 (2006 est.)
note: data are in 2008 US dollars

GDP - composition by sector

agriculture: 39.2%
industry: 16.8%
services: 44% (2008 est.)

Population below poverty line

53% (2004)

Labor force

5.747 million (2007 est.)

Labor force - by occupation

agriculture: 90%
industry and services: 10% (2003 est.)

Unemployment rate

NA%

Household income or consumption by percentage share

lowest 10%: 3%
highest 10%: 31.9% (2004)

Distribution of family income - Gini index

39 (2004)

Investment (gross fixed)

8.4% of GDP (2008 est.)

Budget

revenues: $1.254 billion
expenditures: $1.351 billion (2008 est.)

Public debt

48.9% of GDP (2008 est.)
228.3% of GDP (2004 est.)

Inflation rate (consumer prices)

8.7% (2008 est.)
7.9% (2007 est.)

Central bank discount rate

NA% (31 December 2008)
15% (31 December 2007)

Commercial bank prime lending rate

NA% (31 December 2008)
27.72% (31 December 2007)

Stock of money

$NA (31 December 2008)
$361.5 million (31 December 2007)

Stock of quasi money

$NA (31 December 2008)
$250.4 million (31 December 2007)

Stock of domestic credit

$NA (31 December 2008)
$406.2 million (31 December 2007)

Industries

tobacco, tea, sugar, sawmill products, cement, consumer goods

Industrial production growth rate

4% (2008 est.)

Electricity - production

1.13 billion kWh (2006 est.)

Electricity - production by source

fossil fuel: 3.3%
hydro: 96.7%
nuclear: 0%
other: 0% (2001)

Electricity - consumption

1.051 billion kWh (2006 est.)

Electricity - exports

0 kWh (2007 est.)

Electricity - imports

0 kWh (2007 est.)

Oil - production

0 bbl/day (2007 est.)

Oil - consumption

6,160 bbl/day (2006 est.)

Oil - imports

6,788 bbl/day (2005)

Oil - exports

0 bbl/day (2005)

Oil - proved reserves

0 bbl (1 January 2006 est.)

Natural gas - production

0 cu m (2007 est.)

Natural gas - consumption

0 cu m (2007 est.)

Natural gas - exports

0 cu m (2007 est.)

Natural gas - imports

0 cu m (2007 est.)

Natural gas - proved reserves

0 cu m (1 January 2006 est.)

Current Account Balance

-$241 million (2008 est.)
-$75 million (2007 est.)

Agriculture - products

tobacco, sugarcane, cotton, tea, corn, potatoes, cassava (tapioca), sorghum, pulses, groundnuts, Macadamia nuts; cattle, goats

Exports

$830 million (2008 est.)
$721 million (2007 est.)

Exports - commodities

tobacco 53%, tea, sugar, cotton, coffee, peanuts, wood products, apparel

Exports - partners

South Africa 10.8%, Egypt 9.8%, Zimbabwe 8.7%, US 7.4%, Netherlands 7%, Russia 5.8%, Germany 5.7% (2008)

Imports

$1.587 billion (2008 est.)
$1.323 billion (2007 est.)

Imports - commodities

food, petroleum products, semimanufactures, consumer goods, transportation equipment

Imports - partners

South Africa 35.7%, India 8.1%, China 7.2%, Tanzania 5.8%, US 4.5% (2008)

Reserves of foreign exchange and gold

$185 million (31 December 2008 est.)
$217.2 million (31 December 2007 est.)

Debt - external

$1.039 billion (31 December 2008 est.)
$894 million (31 December 2007 est.)

Stock of direct foreign investment - at home

$11.23 billion (31 December 2008 est.)

Stock of direct foreign investment - abroad

$NA

Market value of publicly traded shares

$NA (31 December 2008)
$NA (31 December 2007)
$587.2 million (31 December 2006)

Economic aid - recipient

$575.3 million (2005)

Currency (code)

Malawian kwacha (MWK)

Currency (code)

MWK

Exchange rates

Malawian kwachas (MWK) per US dollar - 142.41 (2008 est.), 141.12 (2007), 135.96 (2006), 108.894 (2005), 108.898 (2004)

Fiscal year

1 July - 30 June