The International Development Association (IDA) Board of Executive Directors has approved a $35 million (about K61.28 billion) additional grant to Malawi for the Governance to Enable Service Delivery (GESD) Project.
In a letter dated June 14, addressed to Finance Minister Simplex Chithyola Banda, IDA Executive Director Floribert Ngaruko said the objective of the additional financing is to strengthen local authorities’ institutional performance, responsiveness to citizens and management of resources for service delivery.
Ngaruko added that the resources will replenish a financing gap created by the activation of a Contingent Emergency Response Component (CERC) in December 2022 and no additional activity will be added.
“The bulk of project resources (US$70 million) from the parent project are to support the institutionalisation of a system of results-based financing in Malawi’s Local Authorities (LAs) through the introduction of a Performance Based Grant (PBG).
“The primary beneficiaries of the project will be the citizens of Malawi who will be supported by improved service delivery made possible by PBG investments in their LAs and the emergency provisions of maize made available through the activation of the CERC,” Ngaruko said.
In an interview on Tuesday, Chithyola Banda said the additional financing signifies the degree of confidence and trust donors have to this country
“We, as a ministry, are working so hard to change the economic malaise into economic prosperity and these financial injections spell that economic recovery is bearing fruits,” Chithyola Banda said.
Malawi Local Government Association Executive Director Hadrod Mkandawire described the additional financing as a good development considering that availability of the funds is a prerequisite for successful execution of the development projects approved for district councils.
“As you might be aware, this year it will be the very first time that all district councils have qualified to access performance-based grants.
“It is therefore, naturally expected that there is a high level of excitement and eagerness in districts which were missing out on the previous circles to be fully funded, and also benefit from the remaining two circles.
“As such, the refunded money will conveniently meet such expectations,” Mkandawire said.
