Malawi cancels IMF program over changes in policy by new Tonse govt

Minister of Finance Fleix Mlusu has disclosed that the Tonse Alliance government  has cancelled the  International Monetary Fund (IMF)  programme, the Extended Credit Facility (ECF), with immediate effect.

Minister of Finance Felix Mlusu presenti national budget in Parliament on Friday .-Photo by Govati Nyirenda, Mana

Mlusi made the disclosure when he was presenting the 2020/21 national budget in Parliament, Lilongwe on Friday.

“Madam Speaker, following discussions between the Tonse Alliance Government and the IMF, the two parties agreed to cancel the Third Extended Credit Facility on account of changes in policy by the new Administration,” said the Finance Minister.

The policy priorities in the ECF arrangement  were aimed to entrench macroeconomic stability, preserve debt sustainability, and advance governance reforms.

Finance Mnister said it is expected that Malawi government will negotiate a new credit facility.

“However, in the interim, Government has negotiated a second Rapid Credit

Facility which is a fast disbursing instrument amounting to US$100.0 million during the 2020/2021 fiscal year,” he said.

The country’s purse keeper however said government will continue to work closely with IMF and other development partners to address economic challenges facing the country.

Mlusu said government has “already reached out” to the donor community for budget support and debt restructuring.

“I therefore wish to thank all cooperating development partners who have responded positively to this call and expect others to also respond favourably,” said Mlusu.

He also thanked the development partners for the “enormous support” rendered to the Government of Malawi in its development agenda.

“Furthermore, our development partners have been instrumental in supporting Government in times of adversity such as; drought, floods and the recent Covid-19 pandemic,” said Mlusu.

He stressed that Malawi has “relied heavily” on  donors support as domestic revenues “dwindled”  due to the impact of the virus pandemic.

“The Tonse Alliance Government is sincerely humbled and look forward to working with all development partners as we implement the 2020/2021 budget,” he said.

Mlusu ended his budget presentation with  a quote of Henry Ford, an American industrialist and business magnate, saying: “If everyone is moving forward together, then success takes care of itself.”

Parliament has  since adjourned to Monday afternoon when MPs will be divided into clusters to scrutinize the fiscal plan.

Follow and Subscribe Nyasa TV :

Sharing is caring!

Follow us in Twitter
oldest most voted
Inline Feedbacks
View all comments
1 year ago

I hope Harry mkandawire is getting sick to hear words Tonse government
Instead of MCP government.

1 year ago

Kodi Tonse government still crying for Donars?
Leave Donars alone we sick and tired of them.
Mr mlusu please tell Malawians the truth about IMF.

Yalakwa 4
1 year ago

It is still Tonse Alliance government? Right!?

1 year ago

What a breath of fresh air listen to highly experienced, educated, visionary Ministers like Mlusi under the dynamic servant leadership of Chakwera and Chilima compared to the madeya under the uninspiring,mediocre, tribalistic and demonic theifdom of Norman Chisale and his proxy Peter maliseche Munthalika.

1 year ago
Reply to  Malik

Malik Don’t panick too much, uchila. Even your Mr talk talk parrot at State House go tell him kuti achila.

1 year ago
Reply to  Nalimata

Clearly doesn’t understand what people mean when the say uchila/achila. hahahaha

Read previous post:
Tonse govt increases tax free band to K100 000: Introduces tax on bets

Finance Minister Felix Mlusu has announced an increase of tax free band from K45,000 to K100,000, a  tax measure which...