By Rahim Abdul
Parliamentary Committee on Trade and Finance Chairperson Sosten Gwengwe has warned that Malawi’s multiple foreign exchange rates will jeopardise efforts to secure an Extended Credit Facility (ECF) from the International Monetary Fund (IMF), calling for a transparent, unified exchange rate system.
Gwengwe told 247 Malawi News that he agrees with some of the IMF’s observations on Malawi’s economic management but stressed that the country needs a single, market-determined exchange rate for buying and selling foreign currency through legally recognised markets.
Sosten Gwengwe
He said the current system, in which banks and unauthorised traders offer different exchange rates, distorts the economy, makes it difficult to determine the kwacha’s true value and complicates engagement with international financial institutions.
The former finance minister also urged the IMF to provide clearer guidance on managing Malawi’s foreign exchange system, noting that persistent foreign currency shortages remain a major challenge to economic stability and confidence in the financial sector.
On food prices, Gwengwe observed that maize prices have not risen significantly despite the country’s economic difficulties.
However, he cautioned against focusing solely on maize, urging the government to monitor prices of other essential commodities.
He further warned that the anticipated effects of the El Niño weather phenomenon will put additional pressure on food production and prices, urging the government to strengthen preparations to safeguard food availability and price stability.
