The International Monetary Fund (IMF) says its next review mission of the three-year Extended Credit Facility (ECF) will also take into account the socio-economic impact of Covid-19 pandemic on Malawi.
The fourth review mission is slated for September this year and comes on the back of the second and the third reviews of the programme, which were successfully completed in November 2019.
In a brief written response on Tuesday, IMF country representative for Malawi Farayi Gwenhamo confirmed that the next review mission will take place in September.
She said: “The next review mission is scheduled to take place around September 2020 where the IMF staff team will assess performance under Malawi’s ECF arrangement.
“The assessment will duly take into account the socio-economic impact of Covid-19 in Malawi which includes lower economic activity in the country than envisaged pre-Covid-19.”
The ECF supports countries’ economic programmes aimed at moving towards a stable and sustainable macroeconomic position consistent with strong and durable poverty reduction and growth.
Echoing President Peter Mutharika’s State of the Nation Address (Sona) last Friday, Gwenhamo stated that the second and third reviews of ECF were successfully completed in November 2019, paving the way for another review of the programme.
Earlier, she said that in view of the anticipated negative shocks on the macro-economy, IMF suggested the need to “recalibrate” the ECF while also weighing other possible options to help Malawi fight the outbreak beyond ECF.
Gwenhamo said then the magnitude of the macroeconomic shock in Malawi caused by the Covid-19 pandemic was likely going to be sizeable as the virus was evolving fast.
As of Monday this week, Malawi had 443 Covid-19 cases, with 55 recoveries. Four people have died of the virus since the country registered its first three cases on April 2 this year.
In an interview yesterday, social-economic commentator Alex Nkosi said the pandemic has, so far, rendered a lot of Malawians jobless, advising government to institute remedial measures which Parliament can pass into law to guide labour relations in times of Covid-19.
He said: “It is clear that moving on, Malawi will face obstinate challenges to realise its development agenda.”
Nkosi also said government needs to find alternative means of closing the financing gap by, among others, dealing with pervasive tax evasion which he said is leading to loss of tax revenue that could have been used in the fight against the pandemic. Earlier in March, IMF Mission chief for Malawi Pritha Mitra warned that the country risks a potential “deeper disruption” to her economic activity owing to the spillover effects of Covid-19