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Malawi misses on IMF Board calendar

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Sosten Gwengwe

With some people now saying it would be a long shot for Malawi to land IMF’s Extended Credit Facility as the Bretton Woods institution appears to be taking its time, the country’s Finance minister is keeping a cool head, pointing out that there is no Staff Level Agreement yet

A schedule of International Monetary Fund (IMF) Executive Board Meetings has shown that Malawi is not among the countries to be discussed by the Bretton Woods institution next week.

The development casts a serious shadow of doubt on the possibility of the IMF Executive Board approving Malawi’s new Extended Credit Facility (ECF) programme.

Local authorities have over the past weeks been keeping their fingers crossed for a new ECF programme despite that a Staff Level Agreement with the fund is yet to be reached.

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Treasury had hoped that the IMF Executive Board would look at Malawi’s case on July 18.

But according to the IMF Executive Board Meeting schedule posted on the fund’s website, the IMF Board will on July 18 look at the cases of Tanzania, Germany and Kenya.

According to the schedule, on Monday, July 18, the IMF Executive Board will consider Tanzania’s request for a three-year arrangement under ECF.

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On the same Monday, the IMF Executive Board will also consider Germany’s 2022 Article IV Consultation.

For Kenya, the IMF Board will be considering the Third Reviews Under the Extended Arrangement Under ECF; requests for Modification of Quantitative Performance Criteria; and Waiver of Applicability for Performance Criteria Under the Arrangement Under ECF.

The programme says on July 20, the board will consider Article IV Consultation for the Republic of Azerbaijan and Burundi.

On July 22, the IMF Board is expected to tackle Gender Mainstreaming Strategy and 2022 External Sector Report.

The board is expected to meet again on July 25 to consider Article IV negotiations for Equatorial Guinea and Second ECF review for Cameroon.

Finance Minister Sosten Gwengwe on Friday said Malawi is yet to have a Staff Level Agreement with the fund.

He said IMF will on July 18 discuss the misreporting audit report and not ECF.

“Our ECF will only be discussed at board level after Staff Level Agreement which has not happened yet. I am not sure where you are confused.

“Tanzania has a Staff Level Agreement with the IMF. Malawi and Zambia don’t,” Gwengwe said.

Last week, IMF Country Representative for Malawi Farai Gwenhamo said the engagements are ongoing.

“At this stage, the update I have is that discussions are ongoing,” Gwenhamo said.

Briefing reporters on June 6 at the end of the IMF Mission to Malawi, Gwengwe said the fund and Malawi had agreed on a macro framework and that what was left was for Malawi to present to the board a Debt Management Plan and RBM Forex Misreporting Audit Report so that the two parties could reach a Staff Level Agreement which the fund could take to its board on July 18.

“In the next one or two weeks, once these two documents are on the table, then we will engage again for a Staff Level Agreement which must be taken to their board mid-July, specifically July 18 where our fate can be decided by the board.

“But we are hoping for a Staff Level Agreement soon enough once the misreporting audit and the debt plan are put on the table in the next one to two weeks,” Gwengwe said.

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