IMF and Malawi Grain Reserves, A Letter to the Editor By Thomas C. Dawson, Director, External Relations Department, IMF
September 6, 2002IMF and Malawi Grain Reserves
A Letter to the Editor
By Thomas C. Dawson
Director, External Relations Department
International Monetary Fund
September 6, 2002
Frank McDonald's claim (The Irish Times, August 28th) that the IMF advised the government of Malawi to sell off its entire grain reserve is entirely false. This is an old charge that was false when it was first levelled - and it is still false.
The IMF did not advise Malawi to sell its grain; nor did it at any time make grain sales a condition of IMF lending. Maize stocks are expensive to maintain, so a study commissioned by the Malawi government recommended in 2000 that grain reserves be reduced to buffer-stock levels. That also was intended to free up funds for health, education and other social services programmes. The Malawi authorities proposed to follow this recommendation, and the IMF agreed with that policy. That is the limit of our involvement.
The grain reserves subsequently were completely sold off without the knowledge of any international organisation. In early August, the Malawi Anti-Corruption Bureau issued a statement charging that the grain sales involved senior politicians, some of whom never paid for the grain. The case is now in the hands of Malawi's Director of Public Prosecutions. Those interested in the facts can read them at http://www.imf.org/external/np/exr/facts/malawi.htm