World Bank approves $380 million for Malawi, Mozambique


The World Bank on Tuesday approved a $380 million package from the International Development Association (IDA) to support Malawi and Mozambique increase regional trade coordination and reduce trade costs and time.

The money will also be used to develop regional value chains, and improve access to infrastructure.

Of the facility, $305 million is a grant while $75 million is a loan.


In a statement yesterday, the bank says the new Southern Africa Trade and Connectivity Project (SATCP) would benefit Malawi and Mozambique and local communities through investments that will facilitate trade, strengthen regional coordination, and increase diversified economic opportunities along the Nacala and Beira corridors, connecting Mozambique to Malawi, and along the Maputo Corridor, connecting Mozambique to South Africa through Ponta Do Ouro.

The bank says the project would ensure that youth and women are well represented among its beneficiaries.

World Bank Director of Regional Integration for Sub-Saharan Africa, the Middle East, and Northern Africa, Deborah Wetzel, said regional integration can play an important role in helping Southern Africa recover sustainably from the current economic crisis.


“We are pleased to support Mozambique and Malawi in building upon recent regional infrastructure developments by working on reducing trade costs and improving their competitiveness.

“The project’s support for developing regional value chains could drive the creation of jobs and more incomes for communities,” Wetzel said.

According to the bank, the project investments are expected to lead to substantial economic benefits, including increased regional trade, income growth, job creation, and greater resilience, with positive economic spillovers that should benefit other countries in the sub-region.

Project activities also integrate an immediate response to the Covid crisis, and support will be provided to keep borders open during the crisis while modernizing border practices, policies, procedures, systems, and facilities that will ensure process integrity during climate, health, and other emergencies.

The coordination activities between countries can also be used to develop standard operating procedures for future emergencies and pandemics.

SATCP Task Team Leader, Ankur Huria, said the project brings trade facilitation, regional value chains, and transport infrastructure in one project to address key constraints to regional integration.

“Small scale producers and cross-border traders – predominantly women– will benefit from improved facilities and value chain development, mechanisms to reduce harassment, and further access to skills and finance,” Huria said.

Treasury Spokesperson Williams Banda said Treasury is grateful for World Bank continued support adding that the financing will go a long way to improve infrastructure and connectivity in Malawi.

“Ease of doing business will be improved,” he said.

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