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Treasury maintains economic forecast

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DATE TO BE SET—Gwenhamo

The Ministry of Finance has said the next Extended Credit Facility (ECF) programme, to be discussed with the International Monitory Fund (IMF) early next year, would focus on ensuring economic stability.

The government agreed with the IMF to cancel the third ECF on account of changes in policy following the change of government in June.

In an interview, Treasury spokesperson Williams Banda said discussions on the new arrangement were expected within the first quarter of 2021.

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“Focus of the next ECF will be continuation of macroeconomic stability enhancement alongside economic growth and infrastructure development. The government will also focus on ensuring robust economic governance, transparency and accountability,” Banda said.

IMF Resident Representative Farayi Gwenhamo said dates for negotiations were yet to be set.

The last three-year long ECF arrangement, valued at $107.7 million—an equivalent of 56.25 percent of Malawi’s quota—was approved on April 30 2018 to support the country’s economic and financial reforms.

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Under the arrangement, Capital Hill committed to policy priorities of the ECF arrangement which were aimed at entrenching macroeconomic stability preserve debt sustainability and advance governance reforms while fostering higher, more inclusive and resilient growth.

The IMF approved a $91 million [about K67.3 billion] loan to Malawi for Covid-19 fight under the Rapid Credit Facility (RCF)

Under the RCF, the fund imposed conditions for the government to adhere to, failing which it would negatively impact on its performance under the Extended Credit Facility programme.

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