Malawi & World Bank Sign Financing Agreements

Malawi and World Bank have signed two Financing Agreements amounting to 70 million dollars equivalent to over K53 billion aimed at strengthening institutional and financial capacity in managing climate-related risks and shocks and disasters.

This is in form of a 40 million dollars (MK32 billion) Disaster Risk Management Policy Financing (DPF) which has already been made available and another 30 million dollars (K22.8 billion) Disaster Risk which would be made available upon request in case of future related emergencies effective in the next three years.

Minister of Finance Joseph Mwanamveka who signed the agreement said Malawi has experienced excessive weather shocks which had coincided with government’s fiscal consolidation processes.

“This rendered government with a limited fiscal space to respond to emergencies and undermined fiscal consolidation and macroeconomic gains that had been achieved” Mwanamveka said

He commended World Bank for what he described as a timely support and expressed government’s commitment to implement the program in accordance with provisions of the Financing Agreement as well as Malawi’s own public Finance Management rules.

The funds are expected to be channeled towards institutional reforms, shock-sensitive social protection mechanisms, financial capacity to respond to disasters and safeguarding public infrastructure.

World Bank Country Manager, Greg Toulmin in his remarks said through the funds, the Bank has provided a short term immediate response to the impacts of Cyclone Idai

He added that “the budget support was the proper context to respond to the issue of Cyclone Idai.”

Government spokesperson, Mark Botomani said the financial support is a testimony of confidence donors and stakeholders have in government’s financial prudence and governance.