Despite facing economic challenges, Malawi’s ongoing reforms have garnered positive expectations from the International Monetary Fund (IMF). Following discussions with Malawi Government authorities from January 22nd to 26th, the IMF’s mission chief, Mika Saito, expressed confidence in the government’s economic initiatives.
In a statement released on January 26, Saito highlighted the IMF’s anticipation of economic growth, projecting a rebound in the gross domestic product to 3.3 percent. This surpasses the earlier estimate of 1.6 percent, reflecting the impact of recent reforms.
The discussions centered on the government’s progress in implementing macroeconomic adjustments and reforms under the Extended Credit Facility (ECF)-supported program initiated in November of the previous year. The formal assessment of these efforts is slated for the first review of the ECF arrangement during the upcoming summer.
Saito emphasized the importance of maintaining the reform agenda to restore macroeconomic stability, a crucial foundation for inclusive and sustainable growth, as well as resilience to climate-related shocks.
The IMF’s positive outlook on Malawi’s recovery hinges on the country’s ability to overcome various challenges, including the aftermath of Cyclone Freddy, the Cholera outbreak, and its commendable track record from the previous Staff Monitored Programme with Limited Board Involvement.
Malawi’s Ministry of Finance and Economic Affairs, represented by Simplex Chithyola-Banda, previously noted that the funds unlocked through the ECF program would serve as catalysts for local economic growth.
During the IMF team’s visit, key private and public sector stakeholders, including Minister of Finance and Economic Affairs Simplex Chithyola-Banda and Secretary to the Treasury Betchani Tchereni, engaged in discussions. The conclusion of the IMF team’s visit marks a significant step in assessing Malawi’s economic trajectory and its commitment to implementing crucial reforms.