Malawi hails World Bank financing for Covid-19 reponse, IMF’s $91m on BoP  

Minister of Finance, Economic Planning and Development Jospeh Mwanamvekha has thanked the World Bank for  funding to support Malawi’s response to the global Covid-19 (coronavirus) pandemic, describing the institution’s help  as crucial to Malawi’s determination to prevent the spread of the virus.

Mwanamvekha: Malawi’s purse keeper

Mwamvekha said about $100 million has been injected by the World Bank to Malawi.

The World Bank first released  $7 million in immediate funding  under a new Malawi Covid-19 Emergency Response and Health Systems Preparedness project.

In addition to the new operation, $30 million has been made available from the Disaster Risk Management Development Policy Financing with a Catastrophe Deferred Drawdown Option (Cat-DDO) to strengthen the country’s response to the pandemic.

The Malawi COVID-19 Emergency Response and Health Systems Preparedness project will provide funding towards detection, surveillance, response and system strengthening activities prioritized in the Malawi COVID-19 Preparedness and Response Plan.

“The finances will  help Malawi roll out its strategy to minimize the risk of further imported cases and limit local transmission,” Mwanamvekha said.

World Bank Country Manager for Malawi, Greg Toulmin said: “The COVID-19 pandemic is challenging both Malawi’s economy and its fragile health system.”

He said the funding will therefore support the Government of Malawi’s economic policy response “by mitigating likely revenue shortfalls, as well as helping to address critical care needs for Covid-19 response by strengthening national systems for public health response and addressing the burden that Covid-19 will place on the fragile health system which risks undermining continuity in routine care.”

The new Covid-19 Emergency Response and Health Systems Preparedness project is designed to support Malawi’s National Preparedness and Response Plan for Covid-19 by strengthening disease surveillance systems and capacity for early detection and confirmation of cases, equipping treatment centers and quarantine units, and training health workers and rapid response teams.

Apart from World Bank,  the executive board of the International Monetary Fund (IMF) on Friday approved a disbursement under the Rapid Credit Facility (RCF) equivalent to US$91 million to help Malawi meet the urgent balance of payment (BOP) needs stemming from the COVID-19 pandemic.

“This is timely intervention,” Mwanamvekha said.

Malawi goverment authorities have proactively responded to the pandemic with a national response plan—supported by the World Health Organization and other development partners with measures to preserve macroeconomic stability while protecting the vulnerable.

Key elements include increased health sector outlays, supporting incomes and food security of the most vulnerable households with expanded social assistance and grain purchase programs, and easing liquidity constraints in the banking system.

However the IMF says the deteriorating macroeconomic outlook and policy responses to mitigate the impact of the pandemic on Malawi are creating an urgent BOP need.

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