Britain has it will continue to withhold its aid to Malawi until government restores confidence fully after the cashgate corruption scandal which hit the Joyce Banda administration.
Despite the International Monetary Fund (IMF) approving a $20 million loan to Lilongwe, the British government, one of Malawi’s largest bilateral donors, has said it will not resume aid until it is sure that its funds will be secure.
“The UK does have a number of sectoral programmes that were financed through government financial systems and these programmes will continue to be frozen, or alternative delivery mechanisms found, until we have confidence that the funds will be secure and used for their intended purpose,” said British High Commission and Department for International Department (DfID) in reaction to IMF’s decision.
The UK also advised government to put in place that financial control measures that would start producing results after cashgate.
“The cashgate investigations are still ongoing and new financial control measures have yet to bed in. The key to building confidence is a record of sustained implementation that demonstrates a changed culture towards issues of fraud, corruption and inadequate financial management control.
“We believe that more needs to be done. We strongly agree with the IMF statement which underlined that to restore confidence the government will need to investigate the cashgate fraud thoroughly and to fully implement its action plan to address the weaknesses in public financial management exposed by the fraud. While there has been some progress, it is too early to judge the impact.”
The Common Approach to Budget Support (Cabs) also said their members will conduct their own review in March; hence, the aid remains frozen.
President Joyce Banda, however, seems unperturbed. In an interview with the UK’s Telegraph newspaper, she dismissively pointed out that it was not the first time that Western donors had walked away from Malawi.
“They [donors] come and go and come and go but we are here, we did not die,” she scoffed.