Former Deputy Minister of Transport and Public Works, Baba Steven Malondera, has strongly dismissed as deliberate disinformation claims circulating on social media that the MCP-led government embezzled over K190 billion in European Union (EU) funds meant for the rehabilitation of the M1 Road.
Baba Malondera
Malondera described the allegations as cheap propaganda, accusing those behind them of either gross ignorance of how international development financing works or a calculated attempt to mislead the public for political ends.
Taking to Facebook, Malondera said the story was entirely fake and designed to stir public anger without any factual basis.
How the M1 Project Is Actually Financed
Contrary to the viral claims, the M1 rehabilitation project is not handled by a Malawian government-controlled Project Implementation Unit (PIU) and does not involve discretionary access to funds by local officials.
According to multiple sources familiar with the financing structure, all payments are made directly by the EU and the European Investment Bank (EIB) to contractors and consultants, and no funds pass through the Ministry of Transport or any government account.
In practical terms, this means the Malawian government does not touch the money, cannot divert it, cannot reallocate it, and cannot even delay it. This arrangement exists precisely to eliminate the risk of embezzlement.
A Donor-Managed Project with Strict Controls
The project was initially implemented under the previous administration and was managed to such a standard that the donor institutions expanded the financing envelope, which is a rare occurrence in international infrastructure funding.
The M1 project is governed by the EIB’s procurement and compliance framework, which imposes some of the strictest controls in global development finance. These include competitive international procurement processes, independent technical inspections, mandatory quality verification, and strict environmental and social safeguards, all of which are enforced through external supervision by EU-appointed engineers.
To ensure these controls are not merely theoretical, an amount of €4.3 million has been ring-fenced purely for technical oversight and compliance. Without inspection and verification, no payment can be made. This is not a political system but a banking system, and it is designed to be unforgiving.
What the Project Involves
The M1 rehabilitation is a multi-scheme operation covering approximately 347 kilometres of Malawi’s main north–south transport artery, with no change to the existing alignment.
It spans five major road sections from the Kamuzu International Airport junction in Lilongwe to the Songwe Border in Karonga and forms a critical part of the COMESA North–South Corridor.
Its core objectives are to improve food security, reduce transport costs, expand regional trade, and improve access to essential services. This is therefore not a cosmetic project but a strategic piece of economic infrastructure.
The Real Financing Breakdown
For the full rehabilitation of the M1, a total of €247 million was required.
Out of this amount, €192 million comes from EU-linked financing, of which €139 million is a loan from the European Investment Bank that Malawi must repay over a period of 20 years, while only €43 million is a direct grant.
The remaining €55 million must be contributed by the Malawi Government from its own resources.
In March 2025, the EU further added €20.4 million to the project following positive performance assessments.
Why the Embezzlement Claim Collapses on Contact with Facts
The social media claim alleges that €95 million was misappropriated and that the EU ordered Malawi to refund it. Both claims are logically and procedurally impossible under the actual financing structure.
One cannot embezzle money that the government never received, never controlled, never processed, and never approved.
Under this arrangement, the EU and EIB pay contractors directly, and Malawi does not act as a financial intermediary. There is therefore no mechanism through which K190 billion could be siphoned off.
Where Real Financial Pressure Exists
If there is any legitimate financial pressure in the project, it lies in the €55 million domestic contribution that Malawi must mobilise itself.
That funding has to come from tax revenue, budget reallocations, or borrowing, and it must compete with pressing national priorities such as health, education, debt servicing, and social protection.
That is a fiscal challenge. It is not a corruption scandal.
The Bottom Line
The M1 project is one of the most tightly supervised infrastructure projects in Malawi’s history. It is donor-controlled, bank-managed, and externally audited.
The embezzlement narrative is not investigative journalism. It is political fiction.
And those advancing it are not exposing corruption. They are exposing their lack of understanding of how international finance actually works.
