World Bank sets conditions for budget support
The World Bank has given Malawi three conditions to satisfy if the Brettonwoods institution is to resume budget support to the country.
Over the past years, the bank has been withholding a $60 million budget support package for Malawi which created a gaping whole in the financial plan and threw budget implementation off balance.
World Bank Regional Vice President for Africa, Hafez Ghanem, said on Friday that at the 2019 World Bank Annual Meetings, the Malawi delegation expressed strong interest in budget support from the World Bank.
Ghanem said among key areas, the budget support would require a continuing programme with the International Monetary Fund (IMF).
Currently, Malawi has a three-year Extended Credit Facility programme with the IMF which was approved in April 2018 in which the country was allocated SDR 78.1 million (about $112.3 million).
Ghanem added that budget support resumption by the World Bank would require a strong reform programme including substantial evidence of implementation progress.
In addition, Ghanem said there is need for Malawi to ensure regular public communication on the reform programme and status updates.
“On this basis a World Bank team will be visiting Malawi early November to explore in detail what these elements would require,” he said.
Reserve Bank of Malawi Governor, Dalitso Kabambe, who was part of the Malawi delegation which attended the annual meetings in Washington on Thursday told the media that the Malawi delegation and the World Bank formulated a five-pillar roadmap dubbed ‘Agenda for Growth and Job Creation’.
Kabambe said the five pillars in the roadmap include maintaining macroeconomic stability; enhancing and improving private sector-led growth; dealing with energy sector challenges; improving agriculture, value addition and markets; and creating a delivery framework through which all the pillars can be delivered.
“I am glad to report that in the discussions that were there with the World Bank vice-president, they have agreed that a mission should come to Malawi next month to discuss with us what are the costs needed for that roadmap to be implemented,” Kabambe said.
