Forex has recovered. Where is it?

The dollars are reportedly back. The only problem is that nobody seems to have told the people looking for them.

According to the latest figures from the Economics Association of Malawi (Ecama), Malawi’s foreign exchange reserves increased by $104.5 million, from $511.8 million in September 2025 to $616.3 million by June 2026.

That sounds like excellent news.

At last, we might think, the great national hunt for the missing dollar is over. Businesses can import. Manufacturers can buy raw materials. Traders can pay suppliers. Students can pay fees abroad. Patients can settle medical bills. Travellers can buy their dollars without feeling as though they are asking for a favour.

Except there is one small problem.

Where is the forex?

Reports this week indicate that ordinary Malawians and businesses are still struggling to obtain foreign currency from commercial banks. Some legitimate transactions remain delayed, while those desperate enough are pushed towards the parallel market, where the dollar comes with a much heavier price tag.

So, apparently, the forex has recovered.

It has simply not recovered where Malawians need it most.

This is where we must distinguish between reserves and accessible foreign currency. A rise in official reserves is encouraging, but it does not automatically mean that every business can walk into a bank tomorrow and buy the dollars it needs.

And that distinction matters enormously.

Forex is not some exotic financial commodity kept in a glass cabinet at the Reserve Bank. It is the fuel that keeps a modern economy moving.

A manufacturer needs dollars to import machinery and raw materials. A farmer may need foreign currency for fertiliser, chemicals, equipment and other inputs. A pharmaceutical company needs it for medicines. Fuel importers need it to bring fuel into the country. Businesses need it to pay foreign suppliers.

When the dollars are unavailable, production slows down.

When production slows down, businesses sell less.

When businesses sell less, they invest less.

When investment falls, fewer jobs are created.

And when goods become scarce or more expensive to import, prices rise.

That is how a shortage of dollars eventually finds its way into the pocket of an ordinary Malawian.

The World Bank has already warned that foreign exchange shortages are restricting access to critical inputs, while many firms are operating well below their productive capacity. It says Malawi’s real GDP grew by just 1.9 percent in 2025, below population growth of about 2.6 percent. The Bank projects only modest growth ahead and identifies persistent forex shortages as one of the constraints on production and job creation.

In other words, forex shortage is not merely a banking problem. It is a growth problem.

It is an employment problem.

It is an investment problem.

And, increasingly, it is a cost-of-living problem.

The cruel irony is that Malawi can announce better reserves while businesses continue behaving as though the country is running out of dollars.

That disconnect must be investigated.

If reserves have genuinely improved, the public deserves to know why that improvement is not translating into greater availability of forex through legitimate channels.

Are banks receiving enough dollars?

How are they allocating them?

Are priority sectors getting sufficient access?

How much forex is actually available to productive businesses?

And what is happening between the official market and the parallel market?

These are not questions of curiosity. They are questions about economic survival.

The way forward cannot simply be to shout at banks to release more dollars. Malawi must tackle the deeper problem: we consume far more foreign currency than we generate.

Imports continue to dwarf exports. The World Bank says Malawi’s current account deficit is close to 20 percent of GDP, with imports more than two-and-a-half times exports.

That is the elephant in the forex room.

Malawi needs to produce more, export more and diversify what it exports. Tobacco alone cannot permanently finance an economy hungry for fuel, machinery, medicines, fertiliser and consumer goods.

Mining, agro-processing, tourism, manufacturing and other export-oriented sectors must therefore move from speeches to serious investment.

Government must also create an environment in which exporters actually want to bring their dollars home, while reducing unnecessary barriers that make importing productive inputs unnecessarily difficult.

And the banking system must provide greater transparency about legitimate forex allocation.

Because a recovery that exists on paper but cannot be felt in factories, shops, farms and businesses is only half a recovery.

Malawi does not merely need more dollars sitting in reserves. It needs dollars circulating productively through the economy.

Otherwise, we will continue celebrating the recovery of forex while Malawians stand outside the bank asking the most irritating economic question of all:

“If the forex is there, why can’t we find it?”

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