The International Monetary Fund (IMF) said a staff visit to Malawi had made progress on a set of macroeconomic policies that could be supported by a new lending programme.
“The authorities have been implementing strong reforms to tighten fiscal discipline, reduce the public debt burden, and improve how markets function. These reforms provide a good foundation for an IMF, supported programme,” the Fund said.
“Discussions will continue to finalise the policy package that could underpin an Extended Credit Facility supported programme,” it added.
Malawi’s last IMF programme, worth $175 million, ended in May last year because the country did not complete a review within 18 months of its approval, meaning it received only an initial disbursement of $35 million.
The Southern African nation is one of the world’s poorest countries and its economic difficulties include a high debt burden and declining donor funding.
President Peter Mutharika, who took office a year ago, has said that securing a new IMF deal is crucial to stabilise the economy, as fuel and foreign exchange shortages have persisted.
–Reuters–
