‘EU, World Bank could resume budget support’


Minister of Finance Sosten Gwengwe has said the European Union and the World Bank are among Malawi’s development partners who have expressed intent to resume direct budget support.

Gwengwe said this in Parliament last week, saying the country is on the right path towards economic recovery and prudent use of resources sourced locally and from donors.

He said an EU delegation is this week visiting Malawi to assess the country’s readiness for direct budget support while the World Bank is waiting on IMF’s confidence by granting Malawi an Extended Credit Facility to also resume direct budget support.


“If we are able to pull this off, one thing that we have to deliver is prudent financial management and it starts with our budget. Therefore, blowing the budget especially on the Affordable Inputs Programme may not be the right thing to do,” he said.

Centre for Social Accountability and Transparency Executive Director Willy Kambwandira said the news is exciting to every Malawian.

He, however, said that the current fight against corruption and unnecessary use of resources leaves a lot to be desired.


“There is a need to put in place serious measures that will show that the government is accountable and transparent because it does not make sense to have an acting Auditor General for two years for a government which is serious about checks and balances,” he said.

In an interview last week, an economics lecturer at the University of Malawi Innocent Makuta said the current regime has not shown commitment to prudently use resources.

He cited austerity measures that were announced by the government but were not genuinely followed, especially by senior government officials.

In 2013, donors under the then Common Approach to Budget Support suspended direct budget funding to Malawi following the cash gate in which billions of Kwacha were squandered from the public purse by government officials who connived with businesspersons and politicians.

The donors instead resorted to helping Malawi through organisations or direct projects run by the donors with their direct involvement in a bid to ensure prudent use of the resources.

The freezing of the direct donor aid hit the country’s sectors hard as Malawi cannot finance the deficit on its own.

The country has for many years been implementing national budgets with a glaring deficit financed by borrowed money.

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