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Economy

Ecama Warns of Persistent Inflation and Debt as Tobacco Farmers Protest Rejection Rates

Wednesday, May 20, 2026
Photo: Nation Online

According to Nation Online, the Economics Association of Malawi has cautioned that lowering the national inflation rate to 15 percent by March 2027 will be difficult. In its May 2026 Malawi Inflation Outlook, the group noted that food, electricity, and fuel costs remain major obstacles. Food prices alone accounted for 13.5 percentage points of the 23.4 percent headline inflation recorded in the first quarter of 2026.

Economics Association of Malawi President Bertha Bangara Chikadza warned that the national public debt has reached an estimated $14 billion, Channel Africa reports. Chikadza stated that a projected 9 percent budget deficit will force the government into continued borrowing. Domestic debt now accounts for roughly $9 billion, and the associated interest payments are severely reducing the resources available for public services and development.

In agricultural business news, Wait Holdings has launched a local fertiliser blending facility in Blantyre capable of producing 50 metric tonnes per hour, according to Nation Online. Managing Director Irene Mlundira said the facility is fully operational and aims to reduce reliance on imported fertilisers by offering soil-specific blends. In the financial sector, Malawi24 reports that the Old Mutual Guaranteed Fund has declared a 94 percent return for the 2025 financial year, jumping significantly from the previous year.

Update: The Malawi Environment Protection Authority has officially lifted the operational suspension on Press Cane, according to Nyasa Times. The authority removed a five-month stop order that was originally issued over effluent spillages.

Update: Nyasa Times also reports that tobacco farmers continue to protest persistently high leaf rejection rates at the auction floors. The high rejection rates are putting additional pressure on the economy as the country relies heavily on tobacco exports to resolve ongoing foreign exchange shortages.

Sources

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