World Bank approves $137 million budget support for Malawi

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The World Bank has approved $137 million of budget support for Malawi, with an immediate disbursement of $80 million, the bank said in a statement.

The funding will help the southern African country enhance fiscal sustainability, stimulate private sector-led growth, and increase resilience to shocks, the World Bank said.

After the initial $80 million, the remaining $57 million can be triggered in the event of a crisis, it added.

The support comes as Malawi battles chronic foreign-currency shortages that have led to a lack of fuel, medicines and fertilisers.
Malawi devalued its kwacha currency by 30% against the dollar last month.

“The Bank is now able to respond with a substantial budget support operation that supports an ongoing program of reforms,” said Nathan Belete, World Bank country director for Malawi, Zambia, Zimbabwe and Tanzania.

The International Monetary Fund, which approved a loan of about $178 million to Malawi in November, has said the country needs almost $1 billion in debt relief by 2027.