IMF gives Malawi life saving Rapid Credit Facility

IMF has finally given Malawi, the life saving Rapid Credit Facility (RPD), minister of Finance Sosten Gwengwe has confirmed.

This means the much needed forex would start flowing in the country now, unlocking the fuel bottlenecks which the country has been experiencing.

In an interview, Gwengwe said the facility would allow Malawi get half of the US$350 million it applied under the Extended Credit Facility (ECF).

“This facility will help us deal immediately with some challenges, such as lack of forex,” he said.

He said discussions with the IMF on the facility, which has just been introduced to poor countries facing economic challenges due to effects of covid-19 pandemic, among others ends this week in Malawi before the issue is brought before the board of directors of IMF in Washington DC, United States.

IMF, in a statement, has described as productive the discussions it had with the government of Malawi over a request by authorities for emergency funding under the Rapid Credit Facility-RPD- Food Shock Window.

This follows a series of meetings which the IMF team led by  its Chief to Malawi Mika Saito held with various government officials including President Lazarus Chakwera, Minister of Finance and Economic Affairs Sosten Gwengwe , Reserve Bank  of Malawi Governor Wilson Banda and other senior government officials.

The RPD – Food Shock Window provides low access to finance to low income countries facing balance of payment.

In a statement issued at the end of the visit to Malawi, the IMF team said the fund had productive discussions with authorities and made good progress on the request for disbursement of the emergency funds under–Food Shock Window but discussions will continue  from 11 – 17th October in US during the IMF- World Bank Annual Meeting.

Meanwhile, the IMF has said Malawi has expressed commitment to qualify for an Extended Credit Facility once progress has been achieved on the debt restructuring process.