The International Monetary Fund (IMF) says any new programme for Malawi will prioritise prioritise reforms under the National Economic Recovery Plan (Nerp) to focus on restoring stability, supporting growth and protecting vulnerable households.
IMF resident representative Nelnan Koumtingue said in a written response on Friday that any new potential programme would seek to promote poverty-reducing growth and safeguard priority social spending as the country implements recovery measures.
He said the global lender recognises that adjustment measures, including exchange rate reforms, can create short-term pressures, making social protection measures critical for vulnerable groups.
Said Koumtingue: “Discussions are ongoing to agree on a package of policies and reforms that could be supported under an Extended Credit Facility arrangement.
“Any potential IMF-supported programme would aim to restore macroeconomic stability and support poverty-reducing growth while protecting vulnerable households and priority social spending.”
He said the IMF believes a comprehensive reform approach supported by social safety nets can help create conditions for sustainable growth and improved living standards.
The talks between the Malawi Government and the IMF follow the collapse of the country’s four-year Extended Credit Facility (ECF) signed in November 2023, which ended after no reviews were completed for 18 months.
Malawi’s five-year Nerp seeks to restore macroeconomic stability and drive private-sector-led growth. It also tackles fiscal and debt challenges while targeting single-digit inflation and a 6.5 percent gross domestic produc t growth rate by 2030.
The plan is intertwined with Malawi 2063, the country’s long-term development strategy which seeks to transform the economy into an inclusively wealthy, self-reliant, industrialised upper-middle-income nation by 2063 and a lower middle-income one by 2030.
To ensure an economic rebound, the plan proposes a shift from traditional subsidies toward fully developed, solar-powered commercial irrigation corridors, establishment of anchor and mega farms by expanding contract farming and agro-processing clusters for maize, soya, rice and cashew to guarantee market access and exports.
Speaking during a national consultative workshop on the Nerp in Lilongwe in June, Economics Association of Malawi president Bertha Bangara-Chikadza said while the draft plan correctly identifies Malawi’s economic challenges, it falls short on the reforms needed to tackle their underlying causes.
Minister of Finance, Economic Planning and Decentralisation Joseph Mwanamvekha earlier conceded that the Nerp’s success hinges on tackling underlying structural challenges, including chronic foreign exchange shortages, lack of fiscal discipline and unlocking new sources of long-term investment finance.
Malawi’s previous ECF programme valued at about $175 million (about K306 billion) collapsed in May 2025 after the government failed to complete the first programme review.
