Economists have called on the Malawi Government to enhance governance systems and prioritise infrastructure development to fully leverage increased funding from the International Development Association (IDA), a financing arm of the World Bank.
The remarks follow IDA’s announcement that it has secured $24 billion (about K42 trillion) in donor contributions, with plans to leverage the funds to raise $100 billion (about K175 trillion).
World Bank Group president Ajay Banga expressed optimism about the potential of the Bretton Woods institution’s unique financing model, noting its ability to mobilise additional resources for low-income countries.
In announcing the funding boost, Banga also revealed plans to streamline the organisation’s operational framework.
Requirements will be reduced from 1 100 to 500, aiming to expedite funding disbursements, minimise bureaucratic hurdles and lessen the burden on low-income countries supported under the IDA framework.
The World Bank emphasised the transformative potential of this initiative, highlighting its ability to drive job creation and economic growth in countries where youth unemployment remains high.
A statement from the World Bank reads: “It provides countries with the resources to build infrastructure, improve education and health systems, and foster private sector growth, all essential for generating jobs and economic opportunities.”
Malawi, one of the low-income countries supported through the IDA framework, has already secured over $380 million (K665 billion) in financing. The funds will support governance reforms, climate resilience projects and development initiatives.
This includes a $60 million (about K105 billion) grant to address acute shortages of essential commodities, $240 million (about K420 billion) for climate resilience and $80 million (about K140 billion) to improve governance systems.
Economic statistician Alick Nyasulu acknowledged that the additional funding presents significant opportunities for Malawi, but stressed the importance of sound governance to ensure that public resources are protected.
“The government must improve its image and strengthen governance systems to safeguard public resources, often lost through inflated infrastructure costs, to fully capitalise on the opportunities,” he said.
Scotland-based Malawian economist Velli Nyirongo, in an interview on Tuesday, described the funding as a transformative opportunity to tackle key challenges such as youth unemployment and infrastructure deficits.
He said: “To maximise its impact, Malawi should prioritise projects with high economic and social returns, such as modernising transport and energy systems to attract investment and align education with labour market needs.”
Nyirongo further emphasised the role of public-private partnerships (PPPs) in amplifying development efforts.
“PPPs can enhance these efforts by leveraging private sector innovation and resources to foster job creation and infrastructure development, while ensuring robust governance and accountability frameworks to prevent corruption and inefficiencies,” he said.
Experts also noted that Malawi’s current economic challenges, including an estimated youth unemployment rate of over 20 percent, require urgent and targeted interventions.
By focusing on impactful projects and ensuring transparency, the country can unlock the full potential of the IDA funding to transform its socio-economic landscape.
The IDA’s simplified processes and additional funding offer hope for low-income countries such as Malawi.
