Malawi is among 25 countries offered a debt service relief by the International Monetary Fund (IMF) under its Catastrophe Containment and Relief Trust.
In so doing, the Fund would allow the countries to channel more financial resources to fighting Coronavirus which has put most economies almost on their knees.
In an announcement made on Monday, IMF Managing Director, Kristalina Georgieva said the relief will run for six months-subject for renewal-depending on the situation of Covid-19.
“This provides grants to our poorest and most vulnerable members to cover their IMF debt obligations for an initial phase over the next six months and will help them channel more of their scarce financial resources towards vital emergency medical and other relief efforts,” Georgieva says in the statement.
The arrangement means debt repayment will be halted for the next six months.
Ministry of Finance and Economic Development spokesperson, Davis Sado confirmed that Treasury has received official communication on the debt relief.
Sado said the move will go a long in achieving the plans made by the Special Cabinet Committee on Coronavirus to mitigate impact of the virus and fight the pandemic.
He could, however, not tell how much the country could save for the country.
“We are now making the calculations to determine how much could be used instead of repaying the debt. We would urge Malawians to hold their peace, very soon the figures will be out,” Sado explained.
The CCRT can currently provide about $500 million in grant-based debt service relief, including the recent $185 million pledge by the United Kingdom and $100 million provided by Japan as immediately available resources.
Other countries to have a debt relief include Benin, Burkina Faso, Central African Republic, Chad, Comoros, Congo, The Gambia, Guinea, Guinea-Bissau, Haiti, Liberia, Madagascar, Mali, Mozambique, Nepal, Niger, Rwanda, São Tomé and Príncipe, Sierra Leone, Solomon Islands, Tajikistan, Togo, and Yemen.
As of Tuesday, Malawi had registered 16 cases of Coronavirus and two deaths.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.