Update: The Malawi government is preparing for new negotiations with the International Monetary Fund (IMF) scheduled for June 9 to 18 to secure an Extended Credit Facility. Finance Minister Joseph Mwanamvekha stated that the talks will focus on macroeconomic stability, fiscal discipline, and economic productivity. As previously reported, Mwanamvekha dismissed speculation that the government would consider another currency devaluation during the upcoming meetings, according to Nation Online.
The African Development Bank (AfDB) projects Malawi's current account deficit will remain high at 16.9 percent of gross domestic product in 2026, slightly down from 17.9 percent the previous year, Nation Online reports. Mzuzu University economics lecturer Christopher Mbukwa noted that the large deficit indicates Malawi is spending more foreign currency on imports than it earns from exports, which triggers currency instability and high inflation. The AfDB also stated that Malawi is increasingly relying on grants rather than loans from international lenders due to its growing debt crisis, according to AllAfrica.
National Statistical Office data shows Malawi recorded a trade deficit of $789 million in the first quarter of 2026, with imports reaching $961 million against just $172 million in exports. The Ministry of Industrialisation, Business, Trade and Tourism stated that weak production capacity has left the country unable to exploit an estimated $328 million in export potential to markets like India, Zimbabwe, and the United States. High-potential products that represent missed export opportunities include soya bean oil cake and legumes, Nation Online reports.
The persistent current account imbalance continues to affect national foreign exchange reserves, which declined to $571.6 million in March 2026, down from $625.7 million in February. According to Nation Online, this drop reduced the country's import cover to 2.3 months. Economists warn that the weak reserves expose the economy to supply disruptions for fuel, fertiliser, and medical supplies, keeping the cost of living elevated for ordinary citizens.