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Malawi cuts 2022 growth forecast on power shortages and inflation

26 Tháng Mười Một 2022
Malawi cuts 2022 growth forecast on power shortages and inflation

By Frank Phiri

BLANTYRE (Reuters) -Malawi has lowered its 2022 growth forecast to 1.7% from 4.1% due to problems with power generation and rising inflation that have piled pressure on the economy, finance minister Sosten Gwengwe said on Friday.

Malawi's economy had recovered since being hit by the twin knocks of the COVID-19 pandemic and extreme weather triggered by a 2019 tropical cyclone, but the finance minister said growth had again suffered due to Cyclone Ana in late January 2021.

The storm damaged the Kapichira hydropower station, knocking off about 130 megawatts from the national grid.

"Malawi's real GDP growth is projected at 1.7% in 2022, a downward revision from 4.1% envisaged at the start of the 2022/23 fiscal year," Gwengwe said in a mid-year budget speech.

In 2023, growth is estimated at 2.6%, he said, adding that rising inflation had also piled pressure on the economy as prices rose for most goods and services, driven by food costs and the impact of a currency depreciation.

Inflation climbed to 26.7% in October but is expected to moderate to 21.5% by the end of the year, and then reach 21.8% in 2023 before starting to decline.

Gwengwe said the government was keen to address persistent budget deficits and reduce the debt-to-GDP ratio to 7.1% from 8.7% at the end of this financial year.

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06-12-2022 04:09:35 (UTC+7)

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