World Bank faults Malawi on aid absorption as EU withholds budgetary support
The administration of President Bingu wa Mutharika is being criticised by the World Bank for poor absorption of its aid.
The bank states, in its report of December 23, 2009, regarding its “Country Assistance Strategy for Malawi” that the country’s absorption of its aid has been “generally poor”.
“The bank allocated about US$340 million for the fourth country assistance strategy for Malawi, and Malawi’s absorption of these resources has generally been poor,” reads the World Bank report.
The report comes in the wake of the European Union’s decision to withhold budgetary support to Malawi.
The EU is withholding about K6 billion because of concerns with the “macro-economic framework” in Malawi.
However, the EU’s Acting Head of Delegation, Horst Pilger, disclosed that Malawi is close to reaching an agreement with the International Monetary Fund (IMF) which would enable the EU “to resume disbursement.”
Malawi’s Minister of Finance, Ken Kandodo, confirmed that donors are withholding their budgetary support as they await an IMF review report for Malawi in January 2010.
Malawi has been in bad terms with bilateral and multilateral donors for its obstinate stand insisting on fixing the exchange rate of the Malawi Kwacha, the local currency.
The Malawi’s government’s obstinacy on the issue has contributed to shortages of foreign currency and fuel which have combined to trigger what commentators say is “the worst Malawi economic crisis” since the country attained independence in 1964.
Tagged with: Bingu, forex, IMF, Ken Kandodo, World Bank
Some comments here sugessts some people do not understand the term ‘poor absorption’. It means failure to utilize committed funds within a specified period of time.
The funds are still with the donors but we have failed to access them because of our own innefficency.
This innefficency most of the times arise from:
1. Failure to report on the first cash transfer
2. The first cash transfer was misused by the implementing organization in this case the government: Stolen, interborrowing within different programs meaning money was used for unitended purposes. ALL THIS IS THEFT
3. Lack of team work: Quarrelling and misunderstanding between top management in this case Bingu and his cabinet and the implementers on the ground. Sometime when there is team work the implementing organization can conceal the gaps KOMA NGATI ABWANAWO ADYA OKHA NDIYE IFE TINGATANI?
ALL THIS IS FAILURE. So it is wrong to accuse the people who are saying GOVERNMENT HAS FAILED.
build more libraries and information center for malawians to face problems head on…the information contained in these centers can help alleviate poverty…bet? check singapore, malaysia, china…lets get into this information society or else we never gonna develop