International Monetary Fund (IMF) has cancelled two scheduled mission visits to Malawi due to security concerns, the fund’s new resident representative to Malawi Farayi Gwenhamo confirmed on Tuesday.
Malawi has been experiencing political unrest over the outcome of the May 21 Tripartite Elections, with the Human Rights Defenders Coalition (HRDC) organising demonstrations, demanding the resignation of Malawi Electoral Commission (MEC) chairperson Jane Ansah for allegedly mismanaging the polls.
IMF had scheduled two Technical Assistance (TA) missions between August 19 and 28 2019.
In an e-mail response on Tuesday, Gwenhamo said since the two TA missions have been rescheduled, their delivery will not be affected.
“No implications are anticipated at this point,” she said, adding that the cancellation of the TA mission would not have any effect on the forthcoming Extended Credit Facility (ECF) review mission which is expected in September 2019.
Gwenhamo said the three-year $112.3 million (about K85 billion) ECF was separate from the TA missions.
She said: “Let me just reiterate that we are working closely with the Ministry of Finance regarding the timing of the mission. We have full visibility into the time schedule for the budget cycle and have taken this information into account in consultation with the ministry’s top officials.”
Meanwhile, Ministry of Finance, Economic Planning and Development has cast doubt on its availability to the ECF mission scheduled for September/October 2019, saying Treasury officials will be busy with the presentation of 2019/20 National Budget.
The ministry’s spokesperson Davis Sado said: “Government officials that IMF mission normally meets will be busy with Parliament and there are fears that once the mission is in the country, they might not be able to meet with government officials.”
In an interview on Wednesday, Minister of Finance, Economic Planning and Development Joseph Mwanamvekha said it was important that Malawians safeguard the integrity of the country.
“If Malawi crumbles, we all will suffer,” he said.
The global lender provides technical assistance to its member countries in a wide range of areas such as public financial management, tax policy and administration, banking supervision, monetary and exchange rate policy, official statistics and legal issues.
In November 2018, IMF executive board completed the first review of Malawi’s ECF arrangement and approved the disbursement $15.4 million (about K12 billion) under the programme.
“Completion of the review enables Malawi to draw the equivalent of SDR11.15 million [about $15.4 million] for advancing structural reforms and improving governance and transparency will be critical to attaining strengthened economic outcomes.
“The authorities’ ECF-supported programme aims to entrench macroeconomic stability and foster higher, more inclusive and resilient growth,” reads the IMF 2018 press statement.
In the statement, IMF observed that Malawi’s programme performance has been satisfactory, but said the fiscal position deteriorated due to larger than expected maize purchases-for food security after poor harvests in some parts of the country-as well as increased spending May 21 elections and payments of past arrears.