There is now light a the end of the tunnel for the Malawi government as the International Monetary Fund (IMF) has come out in the open to declare the country’s Extended Credit Facility (EFC) back on track.
The revelations were made during a media briefing in Lilongwe on Wednesday.
According IMF Chief of Mission to Malawi Oral Williams this due to good management of domestic finance since September 2015.
He said that IMF appreciates the hard work that Malawi government has put in to bring the programmes back on track.
The fund has however, asked government to work on bank reconciliations and report on arrears going forward.
IMF has also promised to assist the government in formulating the 2016/17 budget so that domestic borrowing remains in check.
“Regarding program performance, the authorities have demonstrated a concerted effort to put the program back on track. Program targets on net domestic financing and net domestic assets of the Reserve Bank of Malawi for end December 2015 were met,” said IMF.
However, IMF noted that the buildup in net international reserves fell short of the end-December program floor owing to lower-than expected export revenues and some smoothing of the excessive volatility in the foreign exchange market.
“ On the structural side, reforms in the financial sector were carried out as planned. Improvements in public financial management (PFM), in particular bank reconciliations, are gaining momentum but this needs to be sustained,” stated Williams.
In his remarks, Minister of Finance, Goodall Gondwe could not hide his gratitude over the development.
He has since called on other donor partners to follow suit. He argues that the development would also mean that the country will be out of the woes it has been in lately.
In November 2015 the IMF noted that Malawi was in a “tight situation” to revive the off track ECF programme but pointed out that it was encouraged with measures government was implementing, including cutting the 2015/16 National Budget as recommended by the fund’s mission that certified ECF off track.