OPINION | JOBS & ECONOMY

Malawi’s unemployment crisis and forex shortages could be eased by positioning the country as a destination for international investment.

Guest Essay by Nkhondo Lungu

In the search for solutions to high unemployment in Malawi, a persistent question arises: why has the country’s leadership not taken more concrete steps to address the problem?

Every year, thousands of Malawian students graduate from universities and technical colleges, equipped with skills and qualifications meant to prepare them for the workforce. Yet, upon graduation, many find themselves with no clear opportunities for employment. While the government often points to efforts aimed at improving the business environment, the reality remains that job creation has not kept pace with the growing number of graduates.

If a thriving economy naturally produces jobs, then Malawi’s challenge suggests that something fundamental is missing.

One possible solution lies in attracting outsourced services such as telemarketing, customer support, and call center operations from developed economies like the United States. In Malawi today, customers of telecommunications companies like Airtel Malawi and Telekom Networks Malawi deal directly with service providers. However, in countries like the US, companies such as T-Mobile, AT&T, and Verizon rely heavily on outsourced customer service operations.

When customers call these companies, they are often speaking to representatives based in countries like India, the Philippines, or across parts of Latin America. These jobs have been relocated primarily because of lower labor costs. A wage that would be unsustainable in the United States can provide a decent standard of living in developing economies.

This raises an important question: why is Malawi not positioning itself to attract similar investments?

Even at wages as low as $3 per hour, many Malawians would earn a meaningful income relative to the local cost of living. More importantly, such opportunities would absorb a significant portion of the educated but unemployed workforce.

Malawi already has a key advantage: English proficiency. Compared to some outsourcing destinations, Malawians are often easier to understand, which is a critical factor in customer-facing roles. This linguistic strength, combined with a young and educated population, places the country in a strong position to compete in the global outsourcing market.

In addition to the service-based jobs, manufacturing also presents a major opportunity. Global brands such as Nike, Adidas, and Puma have long established production bases in countries like Vietnam, Indonesia, and Bangladesh for the same reason: affordable labor. These industries create thousands of jobs and stimulate broader economic activity.

However, attracting such foreign investment would do more than just create employment. It would also help address Malawi’s persistent foreign exchange (forex) shortages.

Currently, Malawi struggles with limited forex reserves, which constrains its ability to import essential goods such as fuel, machinery, medical supplies, and raw materials for industry. Businesses often face delays or increased costs when accessing forex, making it difficult to operate efficiently or expand.

Foreign investment, particularly from export-oriented industries and outsourced service providers, would bring in a steady inflow of foreign currency. Call centers, for example, are typically paid in US dollars or other hard currencies. Manufacturing firms that export goods also earn foreign exchange, which enters the local financial system.

This inflow would strengthen Malawi’s forex reserves, stabilize the kwacha, and ease pressure on imports. In turn, businesses would have more reliable access to the foreign currency they need to grow, invest, and create even more jobs. It becomes a reinforcing cycle: investment drives forex inflows, forex stability supports business growth, and business growth generates employment.

Of course, concerns about labor exploitation and poor working conditions cannot be ignored. Experiences in other countries show that without proper regulation, foreign investment can lead to worker abuse and unsafe environments. But these risks are not inevitable. With strong policies, enforcement of labor laws, and clear investment guidelines, Malawi can avoid these pitfalls while still benefiting from global capital.

Ultimately, the issue is not whether Malawi has potential which it clearly does. The issue is whether deliberate and strategic steps are being taken to unlock it. By creating a stable, investor-friendly environment with clear regulations and incentives, the country can attract foreign companies, create jobs for its youth, and simultaneously address its forex constraints.

Without such action, unemployment will remain entrenched, and the economy will continue to struggle under the weight of limited opportunity and constrained growth.

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