The economy of Malawi is one of the least developed in the world, dominated by agricultural activities. It heavily relies upon the agro-based products for a major part of its export incomes.Agriculture is perhaps, one of the main occupations of about 90% of the total population in Malawi, living in the countryside.
Both food and cash crops are simultaneously cultivated in Malawi. In fact, with the help of foreign financial assistances from International Monetary Fund, the country has introduced a number of development programs, for increasing productivity in the agricultural sector. The Malawi GDP contribution coming from this sector is about 34.2%.
Following the severe drought in 1992, the GDP fell by 7.9% on the basis of an annual growth of 4.5% in 1989-1991. The average annual growth in agro-based production was 3.7% between 1988-1998. In 2001, this growth rate was 1.7%.
Livestock raising is an important part of the economy of Malawi. A good number of cattle, goats and pigs are reared, which yields eggs and other poultry items. The Malawi economy also sustains on a handful of industrial activities, prominent among which are exploitation of the country mineral reserves, forestry and fishing.
The country has some minerals like coal, uranium and bauxite, whose occasional mining offers employment to a handful of the population. Together with fishing activities, the extraction of diverse forest products offer considerable support to the growth and development of the Malawi industries. The manufacturing sector of Malawi produces some basic commodities like small consumer items, sawmill products, cement, textiles, tobacco, building and construction materials, sugar, tea, lumber and processed beverages and foods. The Malawi industries account for15.8% of the countrys GDP.
In 2005, the service sector in Malawi contributed 49.9% to the GDP.
As far as the foreign trade in Malawi is concerned, in 2005, the country exported items like wooden products, tea, tobacco, peanuts, cotton, sugar and coffee worth $364 million.
The main importers of Malawi export commodities included Great Britain, Germany, South Africa, United States, Netherlands, Russia, Japan, Mozambique and Egypt. The Malawi imports of foodstuffs, petroleum products, transportation tools. consumer items and semi-manufactured goods accounted for $645 million in 2005. The main import partners of Malawi were India, Zambia, Zimbabwe, South Africa, Tanzania and Mozambique.
The economy of Malawi is dependent on substantial economic aids from international organizations like the World Bank and International Monetary Fund (IMF) and other donor countries across the world. Still, about 55% of the total population in the country is still under the poverty line, as per the 2004 data.
Last Updated on : 25th June 2013