Malawi’s external debt at $846m | Malawi Democrat

Malawi’s total public external debt was at$846.2 million (about K127 billion) at the end of 2010 from $762 million (about K114 billion), The Nation newspaper said, citing a Reserve Bank of Malawi (RBM) economic  report.

The debt amounts to 16.5 percent of the nation’s gross domestic product (GDP), according to the central bank, as reported by the daily paper.

The RBM says the increase is mainly due to increased disbursements by Malawi’s multilateral and bilateral creditors over the years.

The bank says an adjustment was made last year to the debt stock to include debt owed to other bilateral creditors such as Mainland China, Belgium and France whose debt to the country was forgiven at the Highly Indebted Poor Countries (Hipc) Completion Point in 2006, but were still waiting the signing of bilateral agreements to effect the cancellation, reported The Nation.

Bilateral debt accounted for 17.5 percent of the stock, up from 11.2 percent in the preceding year.

“The emergence of new bilateral creditors resulted in significant increase in bilateral debt to close the year at $148.5 million. Commercial debt accounted for 1.3 percent of the total debt stock at $10.8 million,” said the report.

Finance Minister Mr Ken Kandodo disclosed in the 2011/12  budget  that Malawi plans to repay K19.7 billion [about $129.6 million) in form of interest  on all public debts. Out of this amount, K18.6 billion (about $122.3 million) is  interest on domestic debt and K1.1 billion (about $7.2 million) is on foreign  debt.