Malawi sees donor confidence rebuilding
Key development partners and government have jointly set up the Malawi Social Protection Multi-Donor Trust Fund, one of the largest social protection programmes in the country.
Speaking during a signing ceremony at Capital Hill on Monday, United States Ambassador David Young said the fund will harmonise, strengthen and expand Malawi’s social protection programmes.
He said: “In addition to supporting millions of Malawians, the Social Protection Multi-Donor Trust Fund plays an important role as part of Malawi’s debt sustainability plan as it moves toward an Extended Credit Facility.
“The US government, through the United States Agency for International Development, is contributing $4.4 million [about K4.5 billion] to kick-start the trust fund and support the Government of Malawi to scale up and strengthen existing shock responsive safety nets and their delivery systems”.
Young further said the trust fund will continue supporting nationwide investments in social cash transfers for the most vulnerable Malawians, those who struggle to feed their families, including families with elderly or disabled persons.
World Bank country manager Hugh Riddell described the fund as important for economic growth and sustainability; hence, urged the government to continue implementing robust reforms.
He said: “Through the fund, the foreign exchange will be channelled directly to the Reserve Bank of Malawi, thereby helping to solve balance of payment challenges in Malawi.
“We are, therefore, looking forward to great accountability, transparency and openness, which is key for the sustainability of the fund”.
In his brief statement, European Union (EU) head of cooperation Ivo Hoefkens said they are supporting the fund and they will pour in their chunk of funding soon, adding that the backing of the fund by development partners, clearly signals the trust that is being built in the government systems.
Minister of Finance and Economic Affairs Sosten Gwengwe praised the development partners for agreeing to establish the fund which he said is a show of confidence in the current government.
He said the fund shall be a mechanism for addressing the aid fragmentation challenges, and that development partners interested in financing the social protection programmes or the strengthening of harmonised delivery systems could declare a preference for contributing to different components.
In his remarks, Minister of Local Government Blessings Chinsinga said they are excited because the fund will be a catalyst for deepening and broadening decentralisation.
He said: “We will therefore do all what it takes to ensure the resources are well utilised.”
Apart from the US, EU and the World Bank, other donors to the fund include Iceland which has committed $3 million, African Development Bank, United Kingdom and Ireland.
