African Development Bank (ADB) has urged developing countries such as Malawi to use urbanization as an opportunity for economic growth.
ADB made the point in its the African Economic outlook for African nations of 2016 report.
According to the bank, urbanization presents an opportunity if its potential to transform the economy can be harnessed in the country.
Malawi is rated as one of the least urbanized country in the region but the 3.8 % urban growth rate is higher than the overall population growth rate of 2.8 %.
The report however noted that there is need to deal with major challenges that come with urbanization like meeting the demand for housing and other basic services despite limited resources.
Among others, the report has projected inflation to decline by 18.1% in 2016 remaining above the government’s initial target of 12% but an improvement from the current 24.9 percent.
The bank attributed the economic challenges facing Malawi to the floods and dry spells which has affected the agricultural production which is the main contributor to the country’s economy.
The ADB has however projected the economy of Malawi to rebound to 4% possibly reaching 4.9% in 2017 with Agriculture as the main driver.