## Malawi: First Review Under the Three-Year Extended Credit Facility Arrangement and Requests for Modification and Waivers of Nonobservance of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Malawi

_IMF Staff Country Reports, November 30, 2018_

## Source details

**Canonical URL:** [Malawi: First Review Under the Three-Year Extended Credit Facility Arrangement and Requests for Modification and Waivers of Nonobservance of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Malawi](https://www.imf.org/en/publications/cr/issues/2018/11/30/malawi-first-review-under-the-three-year-extended-credit-facility-arrangement-and-requests-46408)

## Other formats

- [Markdown version](/en/publications/cr/issues/2018/11/30/malawi-first-review-under-the-three-year-extended-credit-facility-arrangement-and-requests-46408/index.md)
- [Structured JSON version](/en/publications/cr/issues/2018/11/30/malawi-first-review-under-the-three-year-extended-credit-facility-arrangement-and-requests-46408/index.json)
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## Bibliographic details
- Published: November 30, 2018
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484387306.002

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### Macroeconomic context and near-term outlook
- Economic growth remains moderate, reflecting a weak agricultural harvest and continued electricity shortages.
- Presidential elections are scheduled for mid-2019.
- Fiscal deficits continue to be financed domestically as donor funding remains constrained by governance concerns since the 2013 cashgate scandal, resulting in an increasing public debt burden.

### Program performance (end-June 2018)
- Most quantitative performance criteria (QPC) were met at end-June 2018.
- Significant overperformance on:
  - International reserves.
  - Reduction in Reserve Bank of Malawi (RBM) holdings of government securities.
- Missed performance criteria:
  - QPC on the primary fiscal balance was missed by 0.9 percent of GDP due to expenditure overruns.
  - Continuous QPC on new non-concessional external debt was missed due to a technical oversight in the Technical Memorandum of Understanding.
- Remedial actions and requests:
  - Based on corrective measures, the authorities request waivers of non-observance.

### Structural benchmarks and implementation
- Two structural benchmarks were observed.
- Most remaining structural benchmarks have been completed with delay.

### Policy and reform themes highlighted
- Fiscal policy: pressure from domestic financing of deficits and expenditure overruns affecting primary fiscal balance.
- Public debt: increasing public debt burden due to constrained donor support.
- Public financial management and governance: donor constraints linked to governance concerns dating to the 2013 cashgate scandal; reforms and compliance with structural benchmarks remain focal.
- External debt management: attention to new non-concessional external debt and the Technical Memorandum of Understanding.

### Key statistics and publication identifiers
- Pages: 123
- Volume: 2018
- Issue: 336
- Series: Country Report No. 2018/336
- DOI: https://doi.org/10.5089/9781484387306.002
- Stock No: 1MWIEA2018004
- ISBN: 9781484387306
- ISSN: 1934-7685
- Publication date on the landing page: November 30, 2018

*International Monetary Fund. Malawi: First Review Under the Three-Year Extended Credit Facility Arrangement and Requests for Modification and Waivers of Nonobservance of Performance Criteria-Press Release; Staff Report; and Statement by the Executive Director for Malawi (IMF Staff Country Reports 2018, 336).*

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- **Country Report**
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_Source: https://www.imf.org/en/publications/cr/issues/2018/11/30/malawi-first-review-under-the-three-year-extended-credit-facility-arrangement-and-requests-46408_