Economic inequality has worsened significantly in Malawi in recent years. In 2004, the richest
10 percent of Malawians consumed 22 times more than the poorest 10 percent. By 2011 this
had risen to see the richest 10 percent spending 34 times more than the poorest. Yet even this
shocking statistic is likely to be a significant underestimate1. Anyone who has seen the many large
mansions springing up on the edges of Lilongwe and Blantyre, and the plethora of new shopping
malls being opened, knows that conspicuous consumption amongst the richest is dramatically
growing. Malawi’s Gini coefficient, the key measure of inequality, also shows the extent to which
robust economic growth is benefiting the rich whilst leaving the poor behind. In seven years of
impressive growth, the Gini has leapt up from 0.39, on a par with Cameroon, to 0.45, on a par with
the Democratic Republic of Congo2.
This study modelled the link between inequality, growth and poverty in Malawi over the next five
years. In 2015, 8 million people – 50 percent of the country’s population - live in poverty. Yet if
inequality continues to rise as it has in recent years, by 2020 1.5 million more Malawians will be
poor3. Even if inequality stays broadly at the level it is now, there will still be 400,000 additional
people living in poverty in Malawi by 20204. Unless Malawi acts now to reduce inequality, even rapid
economic growth will fail to reduce poverty in the country.