Mkwezalamba reacts to donor aid freeze

Malawi Finance Minister Maxwell Mkwezalamba has allayed fears that treasury will likely resort to heavy borrowing from the domestic market to patch-up revenue gaps in the wake of the prevailing aid freeze by Malawi’s major development partners.

The minister made an assurance in the capital, Lilongwe today during at a news conference organized by the International Monetary Fund (IMF) to brief the press on the outcome of its two week mission in Malawi to conduct discussions for the third and forth reviews under Malawi’s Extended Credit Facility (ECF) arrangement.

“There should be no fears of government resorting to heavy borrowing. The discussions we have had [with IMF] were such that government should spend within available resources,” Mkwezalamba responded to Business News query.

In the 2013/14 budget statement, government insisted that the current fiscal stance of No Net Domestic Financing is aimed at reducing domestic debt stock which piled up to K170.6 billion.

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