European Union (EU) Ambassador to Malawi Rune Skinnebach has said that devaluation of currency is pointless in a country with low exports like Malawi.
Skinnebach said this in Blantyre during a media interaction with journalists in the southern region.
According to Skinnebach, devaluation works for countries that export a lot of commodities since it aims at encouraging exports.
He noted that Malawi has a few commodities to export hence devaluing the currency does not work.
In May this year, the Reserve Bank of Malawi devalued the Malawi kwacha by 25 percent as the government tried to resolve the challenge of shortage of forex.
However, the problem appears to have not been resolved with government resorting to external borrowing in order to find forex for procurement of commodities such as fuel and fertilizer.
Malawi’s main export is tobacco and the country realized US$182 million in 2022, a drop from the US$197 million raked in 2021.
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