Sigh of relief as development partners resume direct budgetary support to Malawi

World Bank and the Government of Malawi on Monday signed a multi-donor trust fund for social support programme effectively the Bretton Woods institution resuming direct budgetary support to Malawi.

World Bank and the International Monetary Fund (IMF) stopped providing direct budgetary support to the Government of Malawi, citing widespread corruption and bribery in the public service system.

A representative of the donor community making her commitment after signing the agreement with Malawi Government

But Malawians on Monday saw the country’s largest donor community signing direct budgetary aid to the country at a ceremony that took place in Lilongwe.

In attendance at the ceremony were Ministers of Finance and Economic Affairs, Agriculture, Foreign Affairs and International Cooperation, and Local Government Blessings Chinsinga and other senior government officials.

The Minister of Finance and Economic Affairs, Sosten Gwengwe, commended the donor community for partnering with the Malawi Government in fighting poverty.

Gwengwe said the funding is a milestone towards the enhancement of safety nets programs.

World Bank Country Manager Hugh Riddell said the fund is so important because it will help to enhance access to social protection towards poor people.

Riddell called for transparency and accountability in the use of the trust funds.

Gwengwe making his remarks after signing the agreement

In his speech US Ambassador to Malawi, David Young, said the US government is proud of their partnership with the Malawi Government, the World Bank, and the Government of Iceland for quickly mobilizing resources and establishing one of the largest efforts for social protection that Malawi has seen in many years.

He said the new trust fund is an important milestone towards harmonizing social protection financing in Malawi.

“It will enable the Government of Malawi to provide unconditional cash transfers to the most vulnerable Malawians and deliver cash for work to households at risk of extreme hunger. By investing in local communities to undertake public works that recover soils and watersheds, this program will also help boost harvests and increase Malawi’s resilience to the effects of climate change. Most importantly, it will raise incomes for farming households for years to come,” said Young.

Young said the US Government is contributing K4.5 billion to kick start the trust fund.

Iceland Ambassador to Malawi Inga Dora whose government contributed US$3 million towards the fund said her government recognises challenges which this country is facing following the continued Ukraine and Russia War.

Dora commended the Malawi President for condemning corruption in the country.

African Development Bank Director through his representation commended the Malawi Government and the donors for the signing of this fund.

Minister of Gender Children and Community Development and Social Welfare, Patricia Annie Kaliati, commended the donors for the assistance and hoped that the money poured into the trust will help the vulnerable people with electronic cash transfer.

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