By Chisomo Phiri
The World Bank has given Malawi Government additional financial support worth $80 million (about K139.1 billion) to support the implementation of the Malawi Public Finance Management (PFM) Strategy 2023-2028.
Recently, the Government of Malawi launched the 2023-28 MPFM strategy with the overarching objective of attaining sound financial management and discipline in public service delivery for sustainable development, restoring credibility and confidence in government systems, and creating an enabling environment for more effective development performance.
In a press statement released on Friday morning, the Bretton-Woods Institution said the grant, provided through the International Development Agency(IDA) , will support resource mobilisation, budget execution and transparency of public finances.
The funds will be unlocked upon the achievement of indicators such as an increase in domestic value-added tax (VAT) revenue collection, decreases in variance between approved budget and expenditure outturn, and an increase of contract data accessible by citizens.
World Bank country director for Malawi, Zambia, Zimbabwe, and Tanzania Nathan Belete said the programme will help resolve the challenge of limited fiscal space and low forex reserves that have plagued Malawi.
“The Fiscal Governance Program for Results, therefore, presents a new and innovative financing instrument that will enable the government to unlock additional resources in a more predictable manner over the next five years, while also serving as a platform for harmonised planning, coordination, and utilisation of resources for service delivery,” he said.
Belete added that the package will complement the Extended Credit Facility(ECF) programme signed with the International Monetary Fund(IMF) and the World Bank’s Development Policy Financing(DPF) approved in late 2023.
Meanwhile, Simplex Chithyola Banda, Minister of Finance and Economic Affairs, expressed optimism that the grant will create a solid foundation for fiscal governance and sustain policy reforms throughout the PFM Strategy implementation.
Since Malawi earned back the ECF with the IMF, several of country’s development partners have been coming forward with support in form of grants to ease the country’s economic pressure.
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