Malawi President Joyce Banda on Tuesday applauded the Executive Board of the International Monetary Fund (IMF) for approving a new US$156.2 million(about K40 billion) three year Extended Credit Facility (ECF) arrangement for the country .
The IMF board approved the new facility for Malawi on Monday, a decision that will enable an immediate disbursement of US$19.5 million dollars to Malawi.
Malawi faced serious macroeconomic challenges in the last two years, including a severe shortage of foreign exchange, which translated into shortages of critical imports such as fuel, inputs for production, and medicines.
Speaking during official opening of new National Bank of Malawi business centre and head office complex in Blantyre, President Banda said the IMF’s board decision is critical to the country’s quick economic recovery.
Said Banda: “The decision of the IMF is an important endorsement of the government’s plan of a quick economic recovery.
“Such news is also an important indicator to the banking, private and public sectors that we are set to have our economy recover
“So this is good news to the people of Malawi.”
The president then requests the civil society to continuously provide checks and balances to the government to enhance accountability and transparency.
President then said her administration is working towards setting up a project implementation monitoring unit to promote government, civil society and private sector dialogue, transparency and accountability.
President Banda said “I have advised my team to look at the possible implementation of an independent unit that will monitor and evaluate projects that we are implementing in the country, especially the fact that there is so much money coming in from our well wishers.
“There is too much that is coming in that even I am felling to keek track of. Therefore, it is imperative that the government be accountable to the implementations of our various projects.
“Hence this unit will be mandated to check the government on how it is implementing the donor funded projects, so that all this money that we are receiving from our well wishers should benefit Malawians.”
Local economic commentators have hailed the IMF’s resumption of ECF programme it earlier suspended during the Mutharika administration.
The commentators have since advised government to ensure that it implements policies that will uphold the programme.
Dalitso Kubalasa, Executive Director of the Malawi Economic Justice Network-MEJN told Capital Radio that the resumption of the programme symbolizes the trust donors have on Malawi’s economic policies.
“This is a clear sign that donors have confidence with Malawi now. Any decision by the IMF has a huge influence on key donors and partners for Malawi,” said Kubalasa.
The head of the economic think tank has also advised government to distinguish politics from economics so that the programme is not suspended again.
“I only hope that government will discern politics from issues of the economy because such tendencies are the ones that led to the suspension of the ECF in the past,” argued Mr. Kubalasa adding;
“Good politics leads to good economic policies, therefore leave the technocrats of the economy, to do their work without political interference. If we do so, our economy shall continue to thrive and the facility will continue,” disclosed the economic commentator.
The ECF will run for the next three years and the IMF says it will disburse the first part of the loan soon.