….Gwengwes hopes misplaced, clueless
Hours after Finance Minister Sosten Gwengwe told local media that he hopes for a rebound of the economy, the International Monetary Fund (IMF) has said the opposite.
The global economy is at risk of recession and countries like Malawi will be worst hit. Already the country is affected by Cyclone Freddy and man made food shortages after Fertliser Subsidy programme was sabotaged by greed within ruling Tonse Alliance officials.
Nobody has been taken to account for the K750 million fertiliser money paid to a butchery in UK and the matter, just like abuse of Covid 19 funds is being swept under carpert by President Lazarus Chakweras administration.The International Monetary Fund said on Tuesday the risk of a recession has grown for advanced economies in the wake of bank failures in the U.S. and Europe while slightly lowering its outlook for global growth this year.
The IMF said policymakers have a narrow path to walk to bring down inflation while avoiding a recession and maintaining financial stability.
Malawis inflation is well over 30 percent and government has failed to announce any policy measures to address the prolonged economic crisis they blame everything but their incompetence.
The IMF report also said that growth is projected to rise to 3% next year and remain at that level for the next five years. That marks the lowest medium-term growth forecast since 1990 and reflects an expected decline in population growth.
During the two pre-pandemic decades — 2000–2009 and 2010–2019 — world growth averaged 3.9% and 3.7% a year, respectively.
The IMF projects the global economy will expand at 2.8% this year, a hair lower than its January estimate of 2.9%.
“With the recent increase in financial market volatility and multiple indicators pointing in different directions, the fog around the world economic outlook has thickened,” the international body said in its latest World Economic Outlook. “Uncertainty is high, and the balance of risks has shifted firmly to the downside so long as the financial sector remains unsettled.”
The new forecast comes after IMF Managing Director Kristalina Georgieva said last week during a speech in Washington that global growth will expand less than 3% this year, citing rising geo-political tensions and inflation.
The high cost of living coupled with effects of Cyclone Freddy and political mismanagement by the Tonse Administration would make any further slides in the economy more painful for ordinary Malawians.