‘Budget passing holds key to IMF programme’

 

The International Monetary Fund (IMF) on Wednesday said the passing of the 2012/13 proposed national budget will hold key to the approval of the new Extended Credit Facility (ECF) which Malawi has negotiated.

The IMF stance comes barely a week after the Bretton Woods institution and the Malawi Government agreed to a three-year $157 million (about K42.4 billion) relief package to support the country’s ailing economy recovery.

“The successful passage of the [FY2012/13] budget will help pave the way for approval of the new ECF programme by the IMF’s executive board in July 2012,” said IMF resident representative in Malawi Ruby Randall.

She said the board’s consideration will depend on the passage of a budget that promotes macroeconomic stability and in line with recent ECF programme talks.

She reiterated that the new ECF programming —requested by the Malawian authorities— is designed to help Malawian achieve the country’s medium-term goals.

Added Randall: “So, it is the Malawian authorities who are in the driver seat.  The Fund is here to assist and advise, but ultimately the decisions are taken and owned by the Malawian authorities.”   

Randall, however, described the budget as well structured and consistent with the achievement of three goals of fiscal restraint in support of the restoration of macroeconomic stability, strengthened social safety nets to safeguard the poor and improve business climate to help foster private investment, job creation and growth.