Malawi’s Trade Deficit Narrows in 2011 as Exports Climb

Malawi’s trade deficit narrowed to 107.9 billion kwacha ($400 million) last year as exports climbed, the Ministry of Economic Planning and Development said.

The shortfall eased from 121.9 billion kwacha in 2010, the ministry said in a report distributed today in the commercial capital, Blantyre. Exports surged 38 percent to 223.4 billion kwacha, while imports increased 16 percent to 330.1 billion kwacha, according to the report.

Economic growth in Malawi, which earns about 60 percent of foreign currency from tobacco exports, slowed to 4.3 percent in 2011 from 6.7 percent in the previous year. The economy is forecast by the government to expand 5.7 percent in 2013 as farming output expands and a foreign currency shortage eases, Finance Minister Ken Lipenga said on June 8.

Malawi’s central bank raised its benchmark interest rate by 3 percentage points to 16 percent on May 11, days after devaluing the local currency by a third against the dollar. That enabled the government to meet conditions set by the International Monetary Fund for a resumption in financial aid.

To contact the reporter on this story: Frank Jomo in Blantyre at fjomo@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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