A new Open Budget Survey 2025 Debt Accountability Module by the International Budget Partnership reveals that Malawi lacks an independent fiscal institution to scrutinise public debt management, leaving Parliament and the public to rely almost entirely on government's own assessment of its borrowing decisions.

Although the country has legal and policy frameworks for debt management, the survey finds that weak oversight, limited transparency and inadequate accountability have significantly undermined effective debt governance.

According to the report, the Parliamentary Budget Office exists only as an administrative arrangement without legal backing or a dedicated budget, meaning it cannot independently assess debt sustainability, borrowing plans or the government's debt management strategy.

The survey further found that Parliament did not scrutinise the Medium-Term Debt Management Strategy or the annual borrowing plan during the last fiscal year. It also notes that the National Audit Office lacks the legal mandate to audit public debt, removing another critical layer of independent oversight.

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Public finance expert Dalitso Kubalasa said Malawi must strengthen fiscal discipline through enforceable rules while adopting a more realistic exchange rate framework and protecting vulnerable households during economic reforms.

Finance Minister Joseph Mwanamvekha acknowledged the country's heavy debt burden, saying government intends to tackle it through the five-year National Economic Recovery Plan.

Malawi's public debt stood at K23.9 trillion, or 90.9 percent of GDP, by December 2025. Meanwhile, debt servicing is expected to consume K2.793 trillion--about a quarter of total government expenditure--in the 2026/27 financial year. Government also plans to finance a K2.852 trillion budget deficit through additional borrowing, a move analysts warn could deepen the country's fiscal challenges.

The International Budget Partnership cautions that rising debt repayments are increasingly crowding out funding for essential public services such as health, education and social protection, with the poorest Malawians bearing the greatest burden.