Malawi stands at a crossroads. The imminent withdrawal of USAID support, which will cost 5,000 jobs, is a major blow to an economy already struggling with unemployment hovering around 90 percent. This means thousands of previously self-sufficient individuals will be thrown into dependency, deepening poverty and economic stagnation.
But what if we saw this crisis as an opportunity?
Great economies are not built on foreign aid. They are built by entrepreneurs, innovators, and risk-takers. China, South Korea, and Singapore did not rise to prosperity through handouts. They industrialized, encouraged business growth, and made their labor force globally competitive. Malawi must do the same.
In the late 1970s, China was a poor, agrarian nation reliant on foreign aid. It shifted its focus to small businesses, foreign investment, and manufacturing. Today, it is the world’s second-largest economy.
South Korea, devastated by war in the 1950s, is now an economic powerhouse with global brands like Samsung and Hyundai. Its transformation was driven by industrialization, technology, and entrepreneurship.
Singapore, despite having no natural resources, became one of the world’s wealthiest countries by prioritizing business-friendly policies, foreign investment, and exports.
If these nations could do it, why not Malawi?
One of Malawi’s greatest strengths is its cheap labour. This is not a disadvantage—it’s an economic opportunity. Malawians already form the backbone of South African farms, factories, and mines. If South African businesses value Malawian labour, why aren’t we creating the same industries here?
Instead of exporting labour, we should be exporting finished goods. Instead of sending farmworkers to Israel, why not invite Israeli agribusinesses to lease land and invest in Malawi? We have the land, the workforce, and the potential to attract foreign investment if we act strategically.
For Malawi to transform its economy, the government must take decisive action.
First, doing business in Malawi must be made easier. Complex bureaucratic processes discourage potential entrepreneurs and foreign investors. Simplifying business registration, cutting down red tape, and offering tax incentives will encourage more people to start and grow businesses.
Second, small and medium-sized enterprises (SMEs) need to be actively supported. SMEs are the backbone of any strong economy, and providing them with access to financing, business training, and market linkages will drive job creation. When SMEs thrive, so does the nation.
Third, Malawi must aggressively attract manufacturing companies. The country’s low labour costs give it a competitive edge. If China and Vietnam became global industrial powerhouses by capitalizing on affordable labour, Malawi can do the same. Creating special economic zones, improving policies, and offering investment incentives will make the country more appealing to international manufacturers.
Fourth, agriculture must move beyond subsistence farming and embrace value addition. Instead of exporting raw crops like tobacco, tea, and groundnuts, Malawi should focus on agro-processing. Turning agricultural produce into finished goods such as packaged teas, cooking oils, and processed foods will increase export revenue and create jobs along the value chain.
Fifth, infrastructure development must be a priority. Without reliable electricity, good roads, and efficient water supply, businesses will struggle to operate, and investors will look elsewhere. The government must make significant investments in infrastructure to support industrial growth and entrepreneurship.
Finally, digital entrepreneurship must be embraced. The world is shifting toward technology-driven economies, and Malawi cannot afford to be left behind. Investing in internet accessibility, supporting digital startups, and integrating ICT into business models can unlock new economic opportunities. Kenya’s success with M-Pesa is proof that Africa can lead in digital innovation.
Malawi’s economy will not be saved by foreign aid. It will be saved by Malawians willing to take risks, start businesses, and create value. The government’s role is not to hand out jobs but to create an environment where jobs can be created.
We can either mourn the loss of USAID funding or use this moment to reshape our future. The choice is ours.
For too long, we have been passengers in our own economic story. It’s time to take the wheel. The future belongs to those who build it.