A Summary of Statement at the End of an IMF Staff Visit to Malawi
- Malawi’s performance under the Extended Credit Facility program has been good.
- Malawi’s economic outlook is favorable. Economic growth is projected to reach about 5 percent in 2019 supported by a rebound in agriculture and some improvement in electricity generation.
- Malawi’s medium-term growth could rise further to 6-7 percent, driven by infrastructure projects—including electricity generation—crop diversification, greater access to finance, and an improved business climate.
- Malawi’s inflation is expected to ease to around 8 percent at end-2019 and gradually converge to 5 percent over the medium term.
- Malawi has met all but one of the quantitative performance criteria (QPC) for end-December. The other one was not met due to budgetary constraints and funding elections.
- Malawi completed two structural benchmarks on time and most of the rest were met with a short delay.
- Malawi authorities have an ambitious plan for infrastructure projects that aims to support sustainable growth and poverty reduction.
- Malawi’s banking system’s resilience is improving as reflected in reduced non-performing loans and increased provisioning.
- The newly adopted RBM Act has enhanced the RBM’s autonomy.
- Key reform areas are to improve debt
management and public financial management.
- Malawi should address challenges in property rights to sustainably
increase access to finance.
- Malawi needs to put more efforts to ensure fiscal sustainability (IMF PRESS RELEASE, 14 March 2019, after meeting Malawi Government officials from March 5, 2019 on the second review of three-year ECF)