Remittances to Malawi from people in the diaspora have dropped from US$300 million (about K510 million) in 2021 to US$115 million (about K200 million) in the first nine months of 2023.
This is the money which Malawians working outside the country send back home.
Association of Malawians in Ireland president Henry Mkumbira has told the local media that the reduction in remittances is due to the unavailability of forex in the local banks.
However, spokesperson for the Reserve Bank of Malawi Mark Lungu has suggested that a lot of money is still coming into Malawi but people in the diaspora are not using formal channels to send the money.
The reason for using informal channels is because they offer better exchange rates than formal channels.
Speaking when presenting the mid-year budget review last month, Minister of Finance Simplex Chithyola said the Financial Intelligence Authority has been directed to track and monitor all banking transactions with a view to curb a malpractice commonly known as Hawala where local currency is paid into an account in Malawi in exchange for foreign currency outside Malawi.
He added that Ministry of Lands, Government has identified 8,000 plots in the four cities of Mzuzu, Zomba, Lilongwe and Blantyre where citizens living abroad will be given an opportunity to buy residential and commercial plots in a simplified process.
“This initiative is expected to generate forex inflows into Malawi amounting to K250 million every year. From the initial analysis, our diaspora is very interested and eager to participate in this program,” Chithyola Banda.
