Malawi to cut 2012 growth forecast-finance minister

LILONGWE, Oct 3 (Reuters) - Malawi will cut its forecast for economic growth of 4.3 percent this year due to contraction in some major sectors, Finance Minister Ken Lipenga said on Wednesday.

"Our preliminary assessment shows that the economic performance will slow down below our earlier projection of 4.3 percent largely due to a significant contraction in agriculture, manufacturing, forestry and fishing, which have experienced a negative growth," Lipenga told Reuters.

Lipenga would not give a revised growth projection figure.

But he remained optimistic the economy would recover strongly in 2013 with agriculture, manufacturing and the retail sectors leading the way.

The southern Africa country's economy had been on a tailspin earlier this year due to a disastrous fight former President Bingu wa Mutharika picked with international donors, who withheld aid that traditionally accounted for about 40 percent of the national budget.

Mutharika died in April this year of a heart attack.

New President Joyce Banda has worked to restore aid flows and undo several policies that led to a foreign exchange shortage that drove up the costs in the kwacha currency for essentials such as petrol, food and pharmaceuticals.

The country also relies heavily on tobacco sales to generate hard currency.

(Reporting by Mabvuto Banda; Editing by Jon Herskovitz and David Dolan)

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