Macroeconomic Forecast Malawi

Economic performance is expected to remain mixed, although some increase in growth is possible in 2004 and 2005. However, both the budget and balance of payments situation give cause for serious concern. Malawi traditionally runs a large foreign trade deficit that is only partially offset by inflows of aid through the services account. In 2003/04 the external current account deficit is expected to reach 9.2% of GDP, even after taking account official transfers of about 7% of GDP. With an external debt of over US$2.9bn, it is clear that the country's economic profile is extremely fragile. In practice the country

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