Malawi: 2006 Article IV Consultation and Third Review Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility, and Request for Waiver of Nonobservance of Performance Criterion—Informational Annex
Author: International Monetary Fund
Publication Date:
03 May 2007
eISBN:
9781451828177
Language:
English
Keywords:
ISCR; CR; PRGF loan; government; harvest; PRGF-supported program; bumper harvest; G. government finance statistics; records of financing; government record; structural adjustment; RBM board of directors
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This 2006 Article IV Consultation highlights that Malawi is at a critical juncture following its progress on macroeconomic stability, attainment of the Heavily Indebted Poor Countries (HIPC) completion point in August 2006, and the recent launch of the Malawi Growth and Development Strategy, which outlines an ambitious agenda of structural reform to enhance growth and reduce poverty. This paper focuses on the three key challenges facing Malawi over the medium term, which frame macroeconomic policy over the near term.

Abstract

This 2006 Article IV Consultation highlights that Malawi is at a critical juncture following its progress on macroeconomic stability, attainment of the Heavily Indebted Poor Countries (HIPC) completion point in August 2006, and the recent launch of the Malawi Growth and Development Strategy, which outlines an ambitious agenda of structural reform to enhance growth and reduce poverty. This paper focuses on the three key challenges facing Malawi over the medium term, which frame macroeconomic policy over the near term.

Malawi: Relations with the Fund

(As of November 30, 2006)

I. Membership Status: Joined 07/19/1965; Article VIII (December 7, 1995)

II. General Resources Account:

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III. SDR Department:

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IV. Outstanding Purchases and Loans:

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V. Financial Arrangements:

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VI. Projected Obligations to Fund (millions of SDRs; based on existing use of resources and present SDR holdings):

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VII. Implementation of HIPC Initiative:

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VIII. Implementation of Multilateral Debt Relief Initiative (MDRI):

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IX. Safeguards Assessments:

A safeguards update of the Reserve Bank of Malawi (RBM) completed in January 2006 under the PRGF arrangement approved on August 5, 2005, followed up on RBM assessments completed in 2001 and 2003. The 2006 assessment found that although the RBM had taken steps to strengthen its operations, new vulnerabilities had emerged in governance and financial reporting. Recommendations to mitigate the identified weaknesses included: (i) reconstitution of the RBM board of directors, which was dissolved in August 2005, and the subsequent reestablishment of an audit committee; (ii) expansion of explanatory notes in the financial statements to include advances to the government and a letter of credit financial commitments; and (iii) strengthening of the central bank law provisions on the appointment and dismissal of board members.

X. Exchange Arrangements:

The exchange rate of the Malawi kwacha is a managed-float. On December 18, 2006, the exchange rate was MK 138.61 = US$1.00.

XI. Article IV Consultation:

Malawi is on the standard 12-month Article IV consultation cycle. The last Article IV consultation (SM/04/355) was concluded by the Executive Board on October 18, 2004.

XII. Technical Assistance:

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XIII. Resident Representative:

Mr. Thomas Baunsgaard since August 16, 2004.

Malawi: IMF-World Bank Relations

Contact person: Ms. Yisgedullish Amde, Tel. 202 473 2203

A. World Bank Country Assistance Strategy (CAS)

1. The Malawi CAS was approved by the Bank’s board on May 14, 2003. The gray cover report (Report # 25906 MAI) proposed the World Bank’s strategy for Malawi for the next three years (FY04-06), and aims to help the government to address urgent development issues.

2. This current CAS program is organized under three pillars: i) strengthening economic management; ii) establishing a platform for growth; and iii) improving service delivery and strengthening the safety net. Two ongoing projects (Financial Management Transparency and Accountability and Privatization and Utility Reform2), and a Structural Adjustment Credit (Fiscal Management and Accelerating Growth Project3) aim to assist Malawi in attaining the objectives under pillar one. In addition, in response to the drought-induced emergency in early 2005, an Emergency Recovery Grant was approved in September 2005 to support the restoration of assets and production. To support the objectives of pillar two, the ongoing Community Based Land Reform; Irrigation, Rural Livelihoods Road Maintenance, and Rehabilitation; and Road Maintenance and Rehabilitation Projects, well as the just-approved Rural Infrastructure Services Project are under the base case. The World Bank also supports Malawi’s participation in the Southern Africa Power Market Project, which contributes to the achievement of pillar two. Core Bank interventions under pillar three include the HIV/AIDS (MAP) Project, Third Malawi Social Action Fund Project; Secondary Education Project (since closed in December 2005), and two new Projects, Education Sector Support Project, and Health Sector Program with a sector-wide approach (the first SWAp in Malawi, supplemented by a Malaria Booster Project in July 2006). Finally, Malawi also benefits from the Bank-funded Regional Trade Facilitation Project, which contributes to poverty alleviation through private-sector-led growth by improving access to financing for productive transactions and cross-border trade.

3. A new CAS will be presented to the Board on February 16, 2007 and outlines a program of Assistance covering FY07-10 in support of implementation of the Malawi Growth and Development Strategy (MGDS). The Bank’s proposed assistance program is focused on identified MGDS priorities of agriculture and food security, infrastructure development, combating HIV/AIDS, and governance and public sector management.

B. Financial Relations with the World Bank Group

4. The World Bank has been active in Malawi since 1966. Total lending and grants to Malawi from the World Bank as of January 2007 is US$2,720 million, of which US$2,525 million has been disbursed. As of December 2007, there were 10 active projects in Malawi with a net commitment of US$322 million and an undisbursed balance of US$170 million. Sectoral breakdown is as follows: Social Sectors at 48%, Agriculture at 22 percent, Energy, Infrastructure, and Private Sector Transport at 22 percent, and Macro and multisectoral activities at 8%.

5. IFC has one company in its portfolio in Malawi, National Insurance Company (NICO) for a meager US$0.523 million in equity. Future focus will be on expanded IFC assistance for the private sector, especially in manufacturing, mining, and tourism, areas that Malawi has chosen as targets to reduce its dependence on agriculture.

C. Areas in Which the Bank Leads

Education and Health

6. The Multi-Sectoral AIDS Project (US$35 million in grants) was approved in FY04. The project supports efforts by the Government of Malawi to reduce HIV transmission and mitigate the impact of the disease throughout Malawian society, thus also fighting the poverty AIDS brings to families and societies. A major study of Malawi’s HIV/AIDS problem revealed 10 important constraints that the project, scheduled to begin in 2004 and run through 2008, will address through a range of activities, including capacity building in public, private, and civil society organizations; educational work for prevention; and increased support for AIDS orphans. Many of Malawi’s other development partners are also active in this effort, pooling their funds to support this critical effort.

7. The Health Sector Support Project for Malawi (the first project with a Sector Wide Approach in Malawi), approved in December 2004, aims to improve the effectiveness, efficiency, and equity of Malawi’s essential health care delivery system. The project (with US$15 million in grants, and a supplementary Malaria Booster project of US$5 million to strengthen the Bank’s response to Malaria, approved in July 2006), has the following three components: Component 1. Increasing access to quality essential health services by making the already-defined Essential Health Package (EHP) accessible to all, especially to the poorest and most vulnerable populations, including those living in rural districts. Component 2. Increasing the number of staff available through the continuation of the six-year emergency training plan, a concerted recruitment campaign, the financing and filling of current vacancies, the use of volunteers and contractual staff, and other stop-gap staffing strategies. Component 3. Improving the effectiveness and efficiency of both the health system and the referral network to support EHP delivery. The supplementary Malaria Booster project will focus on monitoring and evaluation.

8. The Education Sector Support Project for Malawi (with US$32.2 million in grants), approved in May 2005, provides immediate financing to support the education sector in Malawi. The project has the following six components: Component 1. Complementing government and donors’ efforts to improve quality and expand teacher development and training at all levels. Component 2. Improving the conditions of learning at selected secondary schools staffed with trained teachers or newly trained teachers. Component 3. Providing a School Health and Nutrition package to all primary schools that will include: distribution of vitamin A and iron-folic acid to school children under 10-years-old, de- worming, treatment of malaria and fever, and the promotion of good health and nutrition practices. Component 4. Supplying basic learning materials directly to schools while strengthening the participation of communities in school management. Component 5. The project’s Capacity Building and Policy Development will cover: (i) national education policy consolidation and capacity building; and (ii) support for the implementation of the government’s decentralization policy in education. Component 6. Supporting the physical implementation and management of fiduciary and procurement issues.

Social Protection and Community Development

9. The Malawi Social Action Fund (MASAF) is a long-term, wide-ranging poverty- reduction project that supports decentralization and community capacity building. The project aims to empower individuals, households, communities, and their development partners in the implementation of measures that can assist them in better managing the risks associated with health, education, sanitation, water, transportation, energy and food insecurity, and to provide support to critically vulnerable populations through a variety of sustainable interventions. The current Project, MASAF III (US$60 million, of which US$27 million is in the form of an IDA grant) was approved in FY03. The project encourages communities to develop social safety nets for their most vulnerable members (such as skills training for AIDS orphans), facilitates delivery of the most needed social services, and stimulates communities to save and invest.

Infrastructure

10. The Integrated Infrastructure Services Project, which primarily supports rural energy and transport needs, was approved on June 27, 2006. In addition, Water (FY07) and Infrastructure (FY08) projects are in the pipeline. Another infrastructure project, The Road Maintenance Project (US$30 million) was approved in FY99 and closed on June 2006 after a successful run.

Private Sector

11. Parastatal reform continues to be an urgent need in Malawi. In the past few years, progress has been made with Bank assistance through the Privatization and Utility Reform Project (PURP, US$28.9 million, approved in FY00). PURP aims to improve the quality of and access to economic and physical infrastructure, especially telecommunications, water, and power, by promoting greater private-sector involvement. .PURP was restructured to address slow implementation issues, respond to new challenges facing the government, incorporate lessons learned, and improve the program’s effectiveness.

12. Malawi also participates in the Regional Trade Facilitation Project, which principally aims to contribute to poverty alleviation through private-sector-led growth in participating countries by improving access to financing for productive transactions and cross-border trade. The project brings together a group of countries by setting up a credible insurance mechanism against losses caused by political risks. The governments of these countries would agree to be the ultimate risk takers in the insurance mechanism, thus creating a strong disincentive to bring claims. The private market currently does not offer this type of insurance, particularly for medium-term transactions (over one year). The project will thus widen the scope for private sector activity by extending the maturities at which credit is available. It will also create a more stable business environment by extending consistent and predictable coverage. Finally, through better risk management, the project will lower the risk premium.

Agriculture

13. A Community-Based Rural Land Development Project (US$27 million) was approved by the Board in April 2004. Based on positive community-level experience gained through the MASAF projects, and in partnership with the Government and UK’s Development agency, DFID, this project will acquire idle land and transfer it to small farmers, thus enabling such farmers to feed their families and try to grow surpluses for commercial sale. It is urgent that Malawi move toward a more equitable distribution of land that will provide food security for small farmers. The recently closed Structural Adjustment Credit, FIMAG, also supported agricultural policy reforms (see further details in paragraph 19).

14. An Irrigation, Rural Livelihoods, and Agriculture project (US$40 million), approved in November 2005, aims to complement other activities on the ground. The overarching development objective of the proposed project is to raise the agricultural productivity and net incomes of poor rural households in target districts by providing an integrated package of support, including irrigation, agricultural/ irrigation advisory services, marketing and post-harvest assets and services, and capacity building.

Environment

15. Direct Bank involvement in the environment sector is currently limited to the Mulanje Mountain Biodiversity Conservation Project (US$7 million), which was approved in FY01. The Project aims to raise awareness about conservation needs, strengthen the capacity of the Forest Department and of local communities to carry out conservation measures, and encourage more local community participation in managing the forest reserve. In addition, especially within the framework of MASAF, the project promotes environmentally sound community development initiatives and funds community resource management projects.

Poverty Monitoring

16. The Bank has provided support with the poverty monitoring tasks identified in the Poverty Reduction Strategy Paper (PRSP) as requiring technical assistance. Through the PRSP Trust Fund, the Bank assisted the government (and specifically, the National Statistical Office) in conducting the Second Integrated Household Survey, including design, collection, processing, and dissemination of data covering not only household characteristics, but also community level indicators. Following completion of the survey in 2005, a Poverty and Vulnerability Assessment providing in-depth analysis of the new household data has been prepare in 2006 jointly by the Ministry of Economic Planning and Development, the National Statistical Office, and the World Bank.

D. Areas in Which the Bank and the Fund Share the Lead

Poverty Reduction Strategy

17. The Government of Malawi finalized its first PRSP in April 2002. Following the initial three years of implementation (which have been documented in the government’s Annual Progress Reports) in 2006 the government carried out a comprehensive review of the lessons learned in its implementation. Using the findings of the comprehensive review and the information presented in the Poverty and Vulnerability Assessment, the government has prepared its second PRSP (the “Malawi Growth and Development Strategy”) in Fall 2006. A joint IDA-IMF staff assessment was presented to the Boards of the IMF and the Bank in January 2007, and the Boards have subsequently endorsed the strategy. The IMF and the Bank staffs maintained a collaborative relationship in supporting the government in the process.

Debt Sustainability and Enhanced Heavily Indebted Poor Country (HIPC) Initiative

18. Staff of the IMF and the Bank prepared “Malawi: Completion Point Document for the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative,” which was presented to the Boards of the World Bank and the IMF in August 2006. Malawi’s debt sustainability outlook after HIPC assistance deteriorated substantially since the decision point as a result of a fundamental change in Malawi’s economic circumstances due to exogenous factors. Therefore, the Boards approved the provision of topping-up assistance at the completion point consistent with the guidelines under the enhanced HIPC Initiative. In addition, upon approval of the completion point under the Enhanced HIPC Initiative, Malawi qualified for additional debt relief from IDA, the IMF and the AfDF under the MDRI.

Budgetary Planning, Revenues Administration, and Public Expenditure Reforms

19. The Bank’s assistance in improving public expenditure management has been channeled mainly through its structural adjustment credits. The most recent one, the Fiscal Management and Accelerating Growth (FIMAG, US$50 million) credit, which closed in June 2006, focused on four areas: (i) strengthening public expenditure management, (ii) privatizing state-owned enterprises, (iii) supporting small-holder agriculture and land reform, and (iv) addressing HIV/AIDS.

20. The Financial Management, Transparency, and Accountability Project (FIMTAP, US$24 million, FY03) is also assisting the government with improving financial management systems and increasing transparency. The main objective of the project is to improve civil service and public expenditure management for better allocation and utilization of public resources.

Civil Service and Wage Reform

21. Following the World Bank-financed study on the review of civil service and wage policy issues, the government has begun implementing the recommendations of the study at the end of 2004, including streamlining the system of allowances, consolidating such allowances in the base for personal income tax, rationalizing salary grades, and moving towards a unified salary structure. These reforms are also supported under the IMF Staff Monitored Program.

Emergency Assistance

22. In addition to technical assistance and the reallocation of existing uncommitted funds as appropriate, an Emergency Recovery Project was approved in September 2005 and closed in December 2006. This project supported the restoration of assets and production following the drought-induced emergency in early 2005 and thus supported the core growth strategy of the macroeconomic program adopted by the new administration in May 2004. This emergency grant provided funds to allow critical private sector imports that support the restoration of assets, investment, and production to take place with minimal disruption to the economy.

E. Areas in Which the Fund Leads

Macroeconomic Stability, Fiscal Policy, and Monetary Policy

23. Malawi is confronted with a number of macroeconomic challenges, including a history of repeated fiscal slippages and unpredictable monetary policies, a rapidly rising level of domestic debt, and a persistently high level of real interest rates. The Fund will work with the authorities to master these challenges, both through financial support and technical assistance.

Malawi--Millennium Development Goals

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Source: World Development Indicators database, September 2006

Malawi: Statistical Issues

1. The economic statistics show serious deficiencies that have affected program monitoring. The data module of the Report on the Observance of Standards and Codes (data ROSC), published February 17, 2005, found that, while the legal and institutional framework for the production of macroeconomic statistics was broadly adequate, there were shortcomings in the scope, accuracy, and reliability of data as well as scope for strengthening the provisions of the Statistics Act. There is a need to formally assign the responsibility for the compilation of government finance statistics to the Ministry of Finance, and responsibility for the compilation of monetary statistics to the Reserve Bank of Malawi. The authorities are making efforts to improve the quality and timeliness of economic and financial data through participation in the GDDS. As one of fifteen countries participating in the Fund’s General Data Dissemination System (GDDS) Project for Anglophone African Countries, Malawi has undertaken to use the GDDS as a framework for the development of national statistical systems. Malawi’s metadata have been posted on the Fund’s Dissemination Standards Bulletin Board (DSBB) since December 2002. The Anglophone Africa project (funded by the U.K. Department for International Development (DFID)) aims to assist participating countries to meet GDDS recommended statistical practices and to improve the metadata. Since the original posting, the metadata of the fiscal sector and the socio-demographic data for health and education were updated in March 2004, and those for other sectors, in February 2005.

F. Real Sector Statistics

2. Real sector statistics covering the national accounts, prices, and trade statistics need substantial improvements. Only a limited set of source data is available, and quality and timeliness should be improved. The National Statistics Office (NSO) needs additional resources to meet, in particular, the required quality standard of national accounts. A longterm technical assistance program (2004-07) on national accounts is being provided under a project by Statistics Norway.

National accounts

3. The NSO is responsible for compiling the national accounts data. However, while the final estimates are comprehensive,4 the source data underpinning these estimates are inadequate, due to gaps in coverage, especially for medium- and small-scale establishments, and informal sector activities. Use is not made of relevant surveys and financial statements to prepare estimates of changes in inventories and household final consumption expenditures. Statistical techniques for compilation are deficient, and processes to assess and validate source, intermediate, and final data are generally limited. The framework used is largely based on the 1968 System of National Accounts (SNA) which is in need of updating to the 1993 SNA. The constant price estimates are mainly derived using an index of industrial production (IIP) with 1984 weights, based on production data of 50 large-scale firms, and the consumer price index. There is a recognized need to both update the weights of the IIP and develop a producer price index to improve the constant price series. The national accounts are published in Malawi’s Statistical Yearbook and Quarterly Statistical Bulletin with a significant lag.

Prices

4. A consumer price index (CPI) is available on a timely basis. The CPI is based on the 1997/98 household survey, and data are collected on a monthly basis by regional price collectors. The effectiveness of the index could be improved by using the geometric mean as the elementary aggregate index formula and by applying systematic, comprehensive, and consistent approaches to the quality adjustment of product prices.

Trade

5. Preliminary estimates of trade are now available with a lag of two to three months. Trade data are received electronically from six major ports. The adjustment of imports from c.i.f. to f.o.b. prices is not appropriate and there is no reconciliation with neighboring countries.

G. Government Finance Statistics

6. Malawi reports some fiscal data on a cash basis to AFR. Although administrative records are kept on a manual basis, the systems are designed to provide adequate information. However, there are serious quality problems, including data inconsistencies, that complicate program monitoring:

  • While tax revenue data are received in a timely fashion, it is not always possible to reconcile them with deposits in the Malawi Government (MG) Account No. 1.

  • Nontax revenue collected by line ministries is not properly accounted for in the fiscal reports prepared by the Ministry of Finance. It also includes capital revenue.

  • Data on recurrent expenditure suffer from serious shortcomings partly related to insufficient bank reconciliation at the level of line ministries (between spending records and financing information). The fiscal reports prepared by the Ministry of Finance show spending based on funding data (from the Credit Ceiling Authority). Line ministries subsequently submit spending reports to the Ministry of Finance based on recorded expenditure. At times there are sizable discrepancies between these two sources of data for both wages and other recurrent transactions—to some extent reflecting the widespread practice of reallocation across budget lines.

  • Domestically-financed development expenditure is based on funding released to line ministries, and data on externally-funded expenditure are based on reported project grants and loans. Owing to differences in timing and financing modalities (e.g., some donors require prefinancing of expenditure before reimbursement), there are substantial differences between the flow of expenditure and corresponding financing data. Thus, there are substantial errors in the reporting of capital spending. Also, many donor projects are still not incorporated in the budget, and hence the corresponding expenditure is not captured. Some externally funded development expenditures are likely recurrent and, reported capital expenditure could be overstated.

  • Data on expenditure arrears are likely incomplete, as reporting from the Commitment Control System appears to be only partial, and ministry level data are not consistent from report to report. Previously unknown arrears have repeatedly been cleared through the “special activities” vote, thus calling into question the accuracy of arrears data and the data on clearances.

  • The budget classification and chart of accounts may be adequate for some administrative, economic, functional and program classifications. An output-oriented activities-based budget classification (ABB) is used for the presentation of the budget. However, pro-poor expenditures that have been protected in line with the PRSP are only identified in the ABB classification. As no bridge table exists to map the ABB classification into the program classification used for expenditure reporting and accounting, pro-poor expenditures cannot be monitored.

  • Financing estimates are based on monetary and debt data, rather than on government records of financing. Reporting on treasury bills directly issued to the RBM at times has been slow.

7. The authorities have received significant technical assistance from the Fund and other donors to strengthen expenditure monitoring and reporting, accounting, and statistical reporting, but results have lagged. The government has pledged to strengthen public financial management and fiscal reporting, and renewed efforts are being made to establish a work plan, including effectively utilizing donor technical assistance.

8. Malawi does not report government finance data for inclusion in the Government Finance Statistics Yearbook (GFSY) or the International Financial Statistics (IFS). A STA mission visited Lilongwe in August 2005 to review progress on major issues raised during previous missions. The mission reiterated the importance of continued efforts to implement an Integrated Financial Management Information System (IFMIS), to improve the coverage and sectorization of government financial operations and to correctly classify transactions according to international guidelines. Although the mission assisted the authorities with the compilation of annual fiscal data for 2003/04 in accordance with the GFSY Questionnaire, such data were not reported for inclusion in the publication. The mission proposed, and discussed with the authorities, a migration plan and timetable to adopt the GFSM 2001 methodology.

H. Monetary and Financial Statistics

9. The Reserve Bank of Malawi (RBM) reports monetary and financial statistics (MFS) to STA on a regular basis, however, the latest data available are for September 2006.

10. The MFS mission that took place in April-May 2004 noted that significant progress was achieved in implementing the recommendations made by the MFS mission conducted in August-September 2002. One of the most notable achievements was the improved coverage of the monthly monetary survey that now accounts for more than 90 percent of the banking sector. On the other hand, the mission also noted that some important recommendations were yet to be implemented, such as the sectorization of the domestic economy, and classification of financial instruments to ensure that the MFS of the RBM adhere fully to the methodology of the Monetary and Financial Statistics Manual.

11. Concurrently, the mission completed the development of an integrated database that would be used by the RBM, STA, and AFR for publication and operational needs. The mission also discussed the standardized forms (SRF) that are being adopted by all countries for reporting monetary data to STA. The authorities submitted the SRF test data; however, there has not been further progress after STA provided comments on these test data in October 2005.

I. External Sector Statistics

12. Concepts and definitions used to compile the balance of payments statistics are in broad conformity with the guidelines presented in the fourth edition of the Balance of Payments Manual (BPM4). The NSO has made progress in the transition to the methodology of BPM5. The most recent data reported to STA for publication in the Balance of Payments Statistics Yearbook pertains to 2002. The authorities have advised that updated information will be provided following implementation of several improvements to existing methodology and data sources. Mainly as a result of the liberalization of exchange controls, the compilation of data relies on surveys as the source of information for major components in the balance of payments, such as services, direct investment flows, and other financial transactions of the private sector. Data from primary sources (surveys and/or International Transaction Reporting System reports) are supplemented with information from secondary data sources, such as foreign trade statistics collected by the MRA through customs declarations, debt statistics from the MOF, net foreign assets from the RBM, and information on grants collected from main donors.

Malawi: Table of Common Indicators Required for Surveillance

(As of January 11, 2007)

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Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.

Both market based and officially determined, including discount rates, money market rates, rates on treasury bills, notes and bonds.

Foreign, domestic bank, and domestic nonbank financing.

The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.

Including currency and maturity composition.

Daily (D); weekly (W); monthly (M); quarterly (Q); annually (A); irregular (I); and not available (NA).

Reflects the assessment provided in the data ROSC (published February 17, 2005, and based on the findings of the mission that took place September 116, 2003) for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O); largely observed (LO); largely not observed (LNO); not observed (NO); and not available (NA).

Same as footnote 7, except referring to international standards concerning source data, statistical techniques, assessment and validation of source data, assessment, and revision studies.

1/

NPV terms at the completion point under the original framework; and NPV terms at the decision point under the enhanced framework.

1/

Excludes commitment of additional enhanced HIPC assistance of SDR 10.070 million subject to reciept of satisfactory financing assurance from other creditors.

1/

Under the enhanced HIPC Initiative, an additional disbursement is made at the completion point corresponding to interest income earned on the amount committed at the decision point but not disbursed during the interim period.

4/

The MDRI provides 100 percent debt relief to eligible member countries that qualified for the assistance. Grant assistance from the MDRI Trust and HIPC resources provide debt relief to cover the full stock of debt owed to the Fund as of end-2004 that remains outstanding at the time the member qualifies for such debt relief.

5/

Excludes the portion of debt relief to be financed by additional enhanced HIPC assistance, which is subject to receipt of satisfactory financing assurances from other creditors.

2

Global Development and Learning Network Project was cancelled in November 2005 per the Government’s request.

3

The Fiscal Management and Accelerating Growth Project was closed on June 30, 2006.

4

Covering GDP from the production side at constant prices, GDP by expenditure at current prices, gross national income and its components, national disposable income and use of disposable income, and the capital and financial accounts.

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Cover IMF Staff Country Reports
Malawi: 2006 Article IV Consultation and Third Review Under the Three-Year Arrangement Under the Poverty Reduction and Growth Facility, and Request for Waiver of Nonobservance of Performance Criterion
Author: International Monetary Fund
Volume/Issue:
Volume 2007: Issue 147
Publisher:
International Monetary Fund
ISBN:
9781451828177
ISSN:
1934-7685
Pages:
93
DOI:
https://doi.org/10.5089/9781451828177.002