Economic and Political Developments: 1964-81

Abstract

This chapter describes the agriculture-based export-orientated development strategy pursued in Malawi since independence and the economic success under such a strategy prior to 1977. The development plan placed the manufacturing sector in a subsidiary role to agriculture and stressed the development of both import substituting and export orientated industries. The Government's wages and incomes policy and public sector expenditure were also important components of the outward-looking agricultural development strategy. The economic policy environment and the stability of the political regime were conducive to the inflow of both foreign personnel and capital. The analysis of Malawi's political economy has lead to the conclusion that the country was not the free-market, non-interventionist capitalist economy described by commentators such as S. N. Acharya and R. Agarwala and by many other Bank staff. Rather, it is best described as an essentially mixed economy with fairly high levels of Government intervention.

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