Mutharika pleads for budget support: Commends AfDB for supporting Malawi’s pro-growth policies

Malawian President Peter Mutharika on Wednesday made a frantic appeal to African Development Bank (AfDB) to resume budgetary support.

The surprise plead for budgetary support came as Minister of Finance Goodall Gondwe told parliament almost same time that the IMF team is now in the country but his preliminary meeting with the institution shows Malawi should not have hope in the resumption of budgetary support from traditional Western donors that pulled out of the country in 2013.

Speaking at Kamuzu Palace in Lilongwe when he met AfDB executive directors, Mutharika said the most reliable method of support to a developing country is aid.

“It is our conviction that Malawi needs pro-growth support. It is my government’s commitment that we set the foundation of weaning the country from aid dependence to ensure that we are truly independent. However, that dream will not be possible without support from institutions like the  bank,” said the President.

He added: “I, therefore, invite the bank to partner with us by not only bringing the much needed resources on the table but ideas too. Of course, I am aware that the Bank is already interested in this area”.

President Mutharika commended the AfDB for the current support of $26 million to Malawi under health and education thematic areas. He further expressed trust in the bank’s policy of aligning its support to the priorities of the Government.

The history of development cooperation between the African  Bank and Malawi dates back to June 1969. The Bank’s portfolio in Malawi is currently valued at over US$1 billion, including regional operations such as the Lilongwe West By-Pass under the Nacala Corridor Development Project.

Over the years, the African Development Bank has proven to be highly responsive to Africa’s evolving development, regional and continental integration challenges and needs.

In Malawi, the Bank has been providing support to various sectors and thematic areas, such as health, agriculture, water, irrigation, transport, education, as well as public finance management.

President Mutharika therefore pleaded with the bank to reconsider giving Malawi the direct budgetary support to resuscitate the ailing economy.

Briefing the delegation, Mutharika said government is implementing two major reforms—Public Financial and Economic Management and Public Service—which he described as crucial to attaining efficiency in service delivery.

He said Malawi’s dream to wean itself from aid dependence will not be realised without support from institutions such as AfDB.

The AfDB team, which is being led by Dr. Mohamed Zaghloul, was in the country to among other things assess progress of projects funded by the institution.

The bank officials told Mutharika the bank officials will continue meeting officials from the Finance ministry on priority areas for support.

They have however not committed themselves on the request by the President.

The request comes barely months after Mutharika assured Malawians his government will now run without donor support, saying  aid era is now gone.

He snubbed calls by opposition leader in Parliament Lazarus Chakwera to go back to the donors and plead with them to come back to Malawi.

In parliament, Gondwe told legislators to stop asking the government to increase allocations to some ministries saying Malawi will have to use its own limited resources because his preliminary meeting with IMF officials who arrived in the country Tuesday inspire no hope of resumption of budgetary support.

“We have nowhere to go when we have run out of resources. The IMF team is  in the country, I have been talking to them, and I think we will continue. Scaling down our expenditures even more,” said the Finance minister after calls by MPs to add more money to the ministry of Gender.

“We have to do with what we have,” he said.

Malawi is facing serious economic challenges as inflation keeps on going on, the kwacha is unstable against the dollar and interests high are record high pushing the cost of living higher for ordinary Malawians.

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