Malawi faces economic pressure from potential currency devaluation and new tax measures

The Consumer Association of Malawi (CAMA) has urged the government and the Reserve Bank of Malawi to reject further devaluation of the Malawi Kwacha during ongoing discussions with the International Monetary Fund (IMF). CAMA Executive Director John Kapito warned that additional devaluation could increase the cost of essential imports such as fuel, fertilizer, medicine, and machinery, placing further pressure on households and businesses.

Separately, the World Bank has reported that new tax measures in Malawi are increasing the cost of doing business. According to the latest Malawi Economic Monitor, levies on bank and mobile-money transfers, an increase in Value Added Tax (VAT) from 16.5 percent to 17.5 percent, and a minimum alternate tax on turnover are straining corporate liquidity. These fiscal changes coincide with existing challenges, including foreign exchange shortages, unreliable electricity, and rising input costs.