Malawiâ€™s key donors have pledged about $496 million (about K124 billion) in budget support, double the pledges made last year, according to Finance MinisterÂ Ken Lipenga.
In his budget statement, which is under discussion in Parliament, Lipenga said: â€œTotal revenue and grants for the 2012/13 budget are projected at K394 billion made up of K270.39 billion and K124.08 billion [$496 million] in domestic revenues and grants, respectively.â€
This, Lipenga said, is 140 percent higher than last year when pledged grants stood at K52.68 billion ($210 million).
This is good news for Malawiâ€™s economy that has been teetering on the brink of collapse after former president Bingu wa Mutharika picked a fight with major donors whose support accounts for about 40 percent of the national budget.
The support is also almost close to the $500 million that Treasury estimated the country urgently needs to improve Lilongweâ€™s official foreign reservesâ€™ position now at 1.5 months and pay off outstanding creditors. Three months is the internationally recommended minimum for foreign reserves or import cover.
President Joyce Bandaâ€™s administration has in the last two months been working to reopen aid taps and re-establish diplomatic ties with countries such as Britain, the countryâ€™s former colonial master and biggest bilateral donor.
So far, Britain, the European Union (EU), the World Bank, the International Monetary Fund (IMF) and the African Development Bank (AfDB) are some of the cooperating partners that have already come forward pledging support.