Germany has signed a financial cooperation agreement worth 45 million euros (about K34.8 billion) to help Malawi in the fight against poverty and hunger through social protection programmes such as Social Cash Transfer.
The grant forms part of a 102 million euros (about K78 billion) commitment to Malawi the two governments entered into last year.
The new German Ambassador to Malawi, Jurgen Borsh could however not commit on whether the German government would revert to providing budgetary support, saying: “It is a process, we will come to that decision and will cross that bridge when we get to it.”
Speaking at the signing ceremony in Lilongwe yesterday, the Ambassador said his government is committed to take part in scaling up social protection services for the ultra-poor in the wake of the effects of dry spell which resulted in low maize harvest that left 8 million Malawians vulnerable.
However, he said until his government is satisfied that Malawi’s public finance management is credible, Germany will continue to partner organisations working in the sectors under the financial cooperation agreement as a funding mechanism.
Borsch said off-budget financing was a different approach to immediately provide resources to critical sectors such as health.
Borsch said about 4 million euros channelled through the German initiative One World No Hunger would go towards improving food security and building resilience for people affected by floods, bringing the total to 20 million euros.
“Today we have laid the cornerstone for our further cooperation in the areas of basic education, primary health services, social protection of the ultra-poor and private sector development in rural areas. I am happy that we are able to step up our efforts to the people of Malawi in the wake of the current crisis due to El Nino,” he said.
About 10 million euros will go towards the health sector while another 10 million euros will go to Social Cash Transfer Programme. n