Malawi Economic Justice Network (Mejn) says the less than one percent climate financing allocation to the national budget is too low to shield the economy from the growing costs of mitigating climate change impact. In its recommendations to the 2026/27 National Budget, Mejn said allocating five percent in line with the Public Finance Management Strategy 2023/28 goals of allocating resources consistent with the priorities in the Malawi 2063 First 10-Year Implementation Plan could help cushion the economy. In an interview on Tuesday, Mejn regional manager (South) Marvin Banda said limited resource allocation affects Malawi 2063 enabler, which recognises the essence of environmental sustainability to realise the goals in agriculture commercialisation and industrialisation.
He said: “Prioritising the environment and climate change sector with financial resources has a double benefit of reducing impacts from climate-induced disasters and restoring Malawi’s natural capital. “This would in turn address the prevailing sectoral challenges that emanate from climate change impacts of the sector. .” The Malawi Country Climate and Development Report estimates that the country currently loses 1.7 percent of gross domestic product (GDP) annually due to climatic shocks.
For instance, while GDP growth in 2023 was initially projected at 2.7 percent, the devastating effects of Cyclone Freddy reduced actual growth to just 1.5 percent. Looking ahead, the report further estimates that if Malawi stays on its current low-growth development trajectory, it will likely experience a three to nine percentage point loss in GDP by 2030 and an 8-16 percentage loss by 2050. Published Unicef data shows that between 2010 and 2025, Malawi experienced 19 major flooding events, a rainfall-related landslide, three severe droughts, and five storm disasters, the most recent being cyclones Jude in 2024 and Chido in 2025.
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For instance, El Niño events in 2024 reduced agricultural productivity by 16 per cent, increasing reliance on food imports and exacerbating trade imbalances while Chido exacerbated poverty and food insecurity among over 500 000 households and increased poverty by 14 percentage points among individuals with education levels of primary or less. Ironically, the estimated budget for environment and climate management in 2025/26 has declined in nominal terms by 37 percent, from K282 billion in 2024/25 to K177 billion in 2025/26. In real terms, the budget has declined by over half, accounting for an average inflation of 27 percent, according to Unicef data.
Compared to 2024/25, the share of public climate finance in Malawi’s 2025/26 budget has declined both as a proportion of the total government budgetand GDP, falling from 4.7 per cent to 2.2 per cent of total government budget and from 1.5 per cent to 0.7 per cent of GDP, respectively. Unicef observes that considering the current financing trajectory, available resources will fall short of meeting the required projected needs of $46 billion by 2040, as outlined in the Malawi’s National Adaptation Plan Framework and the Nationally Determined Contribution.
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