* Malawi inflation problem is not an economic mystery, it is an institutional failure
* For decades, Malawians have lived with 20%+ inflation as if it were normal
* This numbness to economic pain has allowed policymakers to rely on the same narrow blunt toolkit of discretionary monetary policy — even though it has repeatedly failed to deliver stability
By Duncan Mlanjira
Diaspora-based Malawian economic expert Thomas Ngoma — who has advanced a serious agenda that if Malawi is to end chronic inflation and boost development, the government administration should opt for currency-board-arrangement-system-as-the-only-credible-monetary-policy-solution-that-malawi-should-implement-to-rescue-the-economic-crisis-economist — still maintains his stand, saying this is the only way the country can “end chronic inflation and boost development”.
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“Malawi inflation problem is not an economic mystery, it is an institutional failure,” says Ngoma, who had maintained this stance throughout the Malawi Congress Party (MCP) administration and amplified it soon after the Democratic Progressive Party (DPP) took over government after the September 2025 general election.
“For decades, Malawians have lived with 20%+ inflation as if it were normal. This numbness to economic pain has allowed policymakers to rely on the same narrow blunt toolkit of discretionary monetary policy — even though it has repeatedly failed to deliver stability.
“Inflation has become a structural habit, not an unavoidable outcome,” says the executive management consultant with over 35 years’ experience, advising clients on strategic business transformation — both in public and private sector regulated environments.
Thomas Ngoma
He gave an example of Zimbabwe, whose “recent experience proves that even a severely damaged monetary system can be stabilised when political discretion is removed”.
“After years of hyperinflation, Zimbabwe has brought inflation down to low single digits — around 4% — by adopting a tighter, rule‑based monetary regime that mimics the discipline of a Currency Board Arrangement (CBA).
“If Zimbabwe can achieve this level of stability after total monetary collapse, Malawi — with far stronger institutional foundations — can go further and target 2%.
“A true CBA is brutally simple, every kwacha in circulation must be backed 100% by foreign reserves, the exchange rate is fixed by law, and the central bank loses the ability to print money at will —everyone knows this tune by heart by now.”
Ngoma has even gone further to offer that he was available to-train-financial-experts-on-how-to-implement-currency-board-administration/, saying all they have to do is to agree to form an implementation team and he was ready to guide the rest step by step to answer all their questions for the team to be fully trained up on it.
He had said: “Malawi used the system before attaining Independence. We had non of these economic problems to do with forex shortages. The UK still uses it today along with Scotland, Northern Ireland, Falklands, Hongkong, Namibia, RSA among others.”
He thus emphasises today that the CBA “forces fiscal discipline, stabilises expectations, and eliminates the political temptation to inflate away deficits”.
“It is the most credible anti‑inflation framework available to a country with weak monetary transmission, high import dependence, and chronic fiscal slippage, like Malawi.
“Malawi inflation persists because the system allows it to persist; Government deficits are routinely monetised; the exchange rate is unstable; policy credibility is low — and the public has adapted to pain, reducing political pressure for reform.
“A CBA would break this cycle by replacing discretion with rules, politics with discipline, and inflation with stability.
“The policy choice Malawi faces is stark: continue normalising 20%+ inflation, or adopt a framework that forces the state to live within its means and gives citizens a stable Kwacha.
“Zimbabwe has shown that radical reform is possible. Malawi can — and should — go one better,” says Ngoma, who in January this year, highlighted that Malawi-does-not-need-to-wait-for-external-aid-or-debt-to-transform-but-needs-knowledge-and-technical-know-how.
“Mobilising local resources to transform Malawi’s economy is a pathway to dignity, sovereignty, and inclusive growth — built from within,” he said. “By mobilising its own fiat and fiduciary resources within a credible, rule-based system, the country can finance the industries, infrastructure, and social systems required for sustained prosperity.”
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