| Malawi: Policy Matrix, October 1998-September
2001 |
 |
Sector |
|
Objectives and Policies |
|
Strategies and Measures |
|
Timing |
|
Technical Assistance |
|
External Sector
|
Exchange rate
policy
|
|
Efficiently allocate of foreign exchange for a competitive
tradable goods sector
|
|
Maintain competitive, unified, market-based exchange
rate
|
|
Ongoing
|
|
|
Trade policy
|
|
Reduce/eliminate barriers to trade and rationalize tariff
structure
|
|
Reduce maximum tariff rate to 25
percent
|
|
June 1999
|
|
|
| |
|
|
|
Maintain the lowered levels of tariffs, as approved in the Customs and
Excise (Tariffs), Amendment No. 2, Order of 1998, (1) on selected raw materials at 5
percent, (2) on selected intermediate goods at 5 percent, (3) on capital goods at 5
percent, (4) on final goods at most at 30 percent
|
|
Ongoing
|
|
|
Public Finance
|
Budget policy
|
|
Promote macroeconomic stability
|
|
Reduce primary fiscal deficit to a near balance and
maintain a modest deficit in the subsequent years
|
|
1999-2001
|
|
|
Revenue policy
|
|
Raise the revenue-GDP ratio and rationalize the
tax structure to ensure an efficient tax system
|
|
Broaden the tax base and cut tax
exemptions
|
|
1998-2000
|
|
|
| |
|
|
Strengthen tax administration
|
|
1999-2000
|
|
IMF/
World Bank
|
| |
|
|
Establish the Malawi Revenue Authority
(MRA)
|
|
March 1999
|
|
|
| |
|
|
|
Provide adequate funding for the MRA and revenue
departments
|
|
Ongoing
|
|
|
| |
|
|
|
Collect tax arrears
|
|
Ongoing
|
|
|
Expenditure
policy
|
|
Improve expenditure monitoring and control using the
medium-term expenditure framework (MTEF) system
|
|
Extend the MTEF/budget process to all ministries, and
establish cost coefficients for individual expenditure subitems
|
|
1998-99
|
|
World Bank
1998/99
|
| |
|
|
|
Set indicative three-year ceilings, by sector, in the
1998/99-2000/01 MTEF
|
|
Oct. 1998
|
|
1998/99
World Bank
|
| |
|
|
|
Fully integrate the MTEF process and the budget through
preparation of rolling three-year budget estimates
|
|
1999-2000
|
|
1999/2000
World Bank
|
| |
|
|
|
Include all previously off-budget items (including items
financed by the European union (EU) and other donors) in the government
budget
|
|
Ongoing
|
|
|
Civil Service Reform
|
|
Establish a lean, more qualified, and better motivated
civil service, with greater focus on priority areas by rationalizing government
ministries, departments, and agencies
|
|
Maintain a temporary freeze on hiring, except for essential
functions, until decisions are taken in the light of the ongoing functional reviews of
major ministries
|
|
Ongoing
|
|
|
| |
|
|
|
Complete detailed functional reviews of all ministries
following the completed strategic reviews of functions and take decisions on
recommendations arising out of the reviews
|
|
July 1999
|
|
1998/99
World Bank
|
| |
|
|
|
Rationalize, outsource, privatize, or eliminate 30
government functions identified in the functional reviews of five major
ministries
|
|
March 31, 1999
|
|
World Bank
|
| |
|
|
|
Complete the rationalization process (outsourcing,
privatization, elimination, and redeployment) based on recommendations arising from the
completed strategic reviews
|
|
Dec. 1999
|
|
1998/99
World Bank
|
| |
|
|
|
Agree on medium-term wage policy consistent with a
decompressed pay structure and a leaner civil service
|
|
1999-2000
|
|
World Bank/
IMF
|
Agriculture
|
Land policy
|
|
Reduce rural poverty
|
|
Implement reforms to improve the efficiency of land
utilization and develop a land market
|
|
Ongoing
|
|
World Bank
|
| |
|
|
|
Submit the final report of the Presidential Commission of
Inquiry on Land Policy Reform
|
|
March 1999
|
|
|
| |
|
|
|
Using the commission's report, prepare a sessional paper
outlining the government's proposals on land policy
|
|
Dec. 1999
|
|
|
Output markets
|
|
Establish conditions for an appropriate price structure
that would allow an efficient crop pattern
|
|
Develop maize markets and increase the supply of maize by
strengthening incentives for private storage of, and trade in, maize
|
|
Ongoing
|
|
|
| |
|
|
|
Administer the maize price band:
(1) ensure that the
formula for the upper band incorporates the current import parity price; (2) update the
maize price band periodically; (3) publicize the lower and the upper levels of the band;
(4) inform the public that the prices are intervention prices, not defended
prices; (5) ensure that all government-funded interventions, including those of
Agricultural Development and Marketing Corporation, sell at no less a price than the
upper band.
|
|
Ongoing
|
|
|
| |
|
|
|
Prepare program of commercialization and privatization for
ADMARC
|
|
April 1999
|
|
|
| |
|
|
|
Implement the program of privatization and
commercialization of ADMARC
|
|
1999-2003
|
|
|
| |
|
|
|
Replace the Strategic Grain Reserve (SGR) with an
autonomous National Food Reserve Agency (NFRA) subject to rule-based interventions
|
|
1999-2000
|
|
|
Rural finance
|
|
Deepen rural markets and improve access to sustainable
financial services
|
|
Safeguard the autonomy of the Malawi Rural Finance Company
(MRFC) and enforce recovery of MRFC loans
|
|
Ongoing
|
|
|
Private Sector Development
|
Increase
efficiency and
broaden the
ownership base
by privatizing
public
enterprises
|
|
Continue the privatization process
|
|
Bring to the point of sale agreed list of government shares
in 15-20 firms
|
|
Oct. 1998-
March 1999
|
|
World Bank
|
| |
|
|
|
Privatize all assets of Malawi Development Corporation
(MDC) and ADMARC Holdings
|
|
1998-2003
|
|
|
| |
|
|
|
Appoint consultants to review the effects of the
privatization program hitherto upon economic efficiency and income
distribution
|
|
April 1999
|
|
|
| |
|
Review and revise the prudential regulatory
frame-work for all financial institutions in order to ensure a uniform regulatory and
taxation framework, and bring all financial institutions under Reserve Bank of Malawi
supervision
|
|
Appoint consultants to review the framework and make
recommendations
|
|
Dec. 1998
|
|
|
| |
|
|
Receive the consultants' reports
|
|
March 1999
|
|
World Bank |
| |
|
|
Issue guidelines for the privatization of the Commercial
Bank of Malawi and the National Bank of Malawi
|
|
March 1999
|
|
|
Labor markets
|
|
Facilitate the employment of skilled expatriate
workers
|
|
Issue, gazette, and publicize a new Employment Permits (EP)
policy that (1) designates "key posts," which are issued automatically to
applicant firms, depending on their size, and (2) permits permanent residents to work
without being subject to EP review
|
|
Done
|
|
|
| |
|
|
|
Appoint independent assessors of the implementation of the
EP policy
|
|
Jan. 1999
|
|
|
| |
|
|
|
Receive the report from the assessors
|
|
March 1999
|
|
|
Infrastructure
|
Transport:
enhance
efficient
resource
allocation and
effective
competition in
the transport sector
|
|
Regarding roads, improve the efficiency of resource
allocation, increase resources for road maintenance, and increase private sector
participation
|
|
Operationalize the National Road Authority (NRA) and the
Road Fund
|
|
1998-99
|
|
EU/World Bank
|
| |
|
|
|
Ensure agreement of NRA and government on annual
expenditure targets and a commensurate strategy for raising road user
charges
|
|
1998-99
|
|
|
| |
|
|
|
Strengthen the management of the sector by restructuring
the Roads Department and creating roads agencies
|
|
1998-2001
|
|
World Bank/EU
|
| |
|
|
|
Commercialize, or part privatize, the PVHO, (the program
supporting emergent contractors)
|
|
1998-2001
|
|
World Bank
|
| |
|
|
|
Improve road safety and reduce the cost of road accidents
by implementing a new strategy with defined performance targets
|
|
June 1999-2001
|
|
World Bank
|
| |
|
Improve operational and financial performance of Malawi
Railways and Lake Services
|
|
Complete the concessioning of Malawi
Railways
|
|
March 1999
|
|
|
| |
|
|
|
Select the privatization option for Malawi Lake
Services
|
|
Done
|
|
|
| |
|
|
|
Establish an appropriate regulatory framework for Malawi
Railways and Lake Services
|
|
June 1999
|
|
|
| |
|
|
|
Complete the privatization of Malawi Lake
Services
|
|
June 1999
|
|
|
Telecommuni-
cations
|
|
Improve the efficiency of telecommunications by encouraging
private participation in infrastructure
|
|
Submit legislation to parliament creating a separate
telecommunications regulatory body and splitting posts and telecommunications into
separate entities
|
|
March 1999
|
|
World Bank/ Danish International Development
Agency
|
| |
|
|
|
Award a second cellular license to a private
operator
|
|
March 1999
|
|
|
| |
|
|
|
License both cellular operators in a way that will ensure
fair competition between them in the marketplace, and make the terms of the license
public
|
|
March 1999
|
|
World Bank/ DANIDA
|
| |
|
|
|
Appoint appropriately qualified advisors to secure a
strategic partner for Malawi Telecommunications
|
|
March 1999
|
|
World Bank
|
| |
|
|
|
Offer a share in the telecommunications firm to a strategic
partner
|
|
June 2000
|
|
World Bank
|
Energy
|
|
Restructure ESCOM and encourage private sector
participation in the energy sector
|
|
Pass an Electricity Act establishing an independent
regulatory body, and incorporate Electricity Supply Corporation of Malawi (ESCOM) under
the Companies Act
|
|
Done
|
|
1998/99
World Bank
|
| |
|
|
|
Incorporate ESCOM under the Companies
Act
|
|
Done
|
|
|
| |
|
|
|
Approve a plan for the debt restructuring of
ESCOM
|
|
Done
|
|
|
| |
|
|
|
Implement the organizational restructuring of
ESCOM
|
|
Dec. 2000
|
|
World Bank
|
Social Sectors
|
Education
|
|
Improve budgetary allocations for key
services
|
|
Maintain the budgetary allocation for nondebt recurrent
budget for the Ministry of Education at 23 percent
|
|
1998/2001
|
|
|
| |
|
|
|
Maintain the share of primary education in the Ministry of
Education budget at 65 percent
|
|
1998/2001
|
|
|
| |
|
|
|
Maintain the share of goods and services expenditure in the
recurrent budget of the Ministry of Education at 25 percent
|
|
1998/2001
|
|
|
| |
|
Improve quality of schooling
|
|
Establish a medium-term teacher development
program
|
|
1999
|
|
U.K. Department for International Development DFID/
Gesellschaft für Technische Zusammen-
acbeit (GTZ)/WB
|
| |
|
|
|
Review and revise the curriculum and establish exit points
from the system
|
|
1998-2001
|
|
World Bank/ DANIDA
|
| |
|
Improve administration, planning, and efficiency of
schooling provision
|
|
Update the education investment framework of 1995, refining
priorities and making targets consistent with budgetary resources
|
|
March 1999
|
|
World Bank/ USAID/ DFID, DANIDA
|
| |
|
|
|
Reform the education planning unit
|
|
1999
|
|
|
| |
|
|
|
Review and regularly revise tuition fees in secondary
education
|
|
Dec. 1999
|
|
|
Health
|
|
Enhance the accessibility of cost-effective health
services
|
|
Complete the health strategy and investment
Framework
|
|
April 1999
|
|
|
| |
|
|
|
Maintain the per capita annual budgetary allocation for
drugs and vaccines at US$1.25
|
|
|
|
|
| |
|
|
|
Introduce Revolving Drug Funds at clinics: 40 percent
(1,120) of them to be operational by Dec. 2000
|
|
1999-2000
|
|
|
| |
|
Improve the efficiency of resource use
|
|
Introduce a graduated cost recovery system, starting with
the specialist referral hospitals and district facilities
|
|
Ongoing
|
|
|
| |
|
|
|
Regularly revise the fee schedule for patients in private
rooms to move toward full cost recovery
|
|
Ongoing
|
|
|
Population
|
|
Reduce population growth by reducing fertility rates from
6.7 to 5.0
|
|
Introduce a comprehensive and integrated community-based
distribution approach to family planning, so as to improve the contraceptive prevalence
rate from 18 percent to 28 percent by Dec. 2002
|
|
Ongoing
|
|
|
Water
|
|
Expand service and strengthen financial viability in water
supply
|
|
Set water tariffs such that water boards are financially
viable
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
Improve water supply management and encourage private
sector participation
|
|
Build private sector capacity to provide all goods and
services for rural water supply
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Rehabilitate and construct new boreholes and gravity-fed
water supplies for villages
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Rehabilitate and expand facilities for small
towns
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Improve supply/distribution and financial management of
Lilongwe and Blantyre water supply systems
|
|
Ongoing
|
|
1998-99
World Bank
|
Gender
and
development and
advancement
of
women
|
|
Mainstream gender issues government policies, programs, and
projects to ensure sustainable development
|
|
Strengthen the implementation, coordination and monitoring
of the National Gender Policy by the Ministry of Women, Youth, and Community
Services
|
|
Ongoing
|
|
|
| |
|
|
|
Raise the awareness of gender issues, women's legal rights,
food utilization and dietary diversification, reproductive health services, and economic
empowerment of women as part of poverty alleviation
|
|
Ongoing
|
|
|
Poverty reduction
and safety nets
|
|
Enhance Poverty Alleviation Program (PAP) through
community-based initiatives
|
|
Identify the percentage of the budget to be transferred to
poverty-reducing programs on an ongoing basis and consistent with a sustainable fiscal
framework
|
|
Dec. 1998
|
|
1998-99
World Bank
|
| |
|
|
|
Review objectives, target groups, main program elements,
and institutional framework for the PAP, and agree on the same for a long-term public
safety strategy
|
|
June 1999
|
|
1998-99
World Bank
|
| |
|
Improve poverty monitoring
|
|
Strengthen the capacity of the poverty monitoring system to
monitor the impact of policy and programs aimed at reducing poverty
|
|
June 1999
|
|
1998-99
World Bank
|
| |
|
|
|
Put monitoring and evaluation systems in place to monitor the targeting
effectiveness and coverage of the public safety net interventions
|
|
June 1999
|
|
|
Environment
|
|
Execute national environmental policies so as to ensure
efficient resource utilization
|
|
Implement the Environmental Management Act of 1996 by,
inter alia, the following:
|
|
|
|
|
| |
|
|
|
Implementing regulations guiding the use of environmental
impact assessment for certain types of private and public investment;
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Adopting policies whereby local communities will share in
revenues from comanagement of natural resources;
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Periodically adjusting water tariffs of the water boards to
maintain economic pricing of water;
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Enforcing estate conservation and afforestation covenants;
and
|
|
Ongoing
|
|
1998-99
World Bank
|
| |
|
|
|
Strengthening the regulatory framework for industrial
pollution
|
|
Ongoing
|
|
1998-99
World Bank
|
Local Government
|
|
Develop a legal and financial framework for local
authorities
|
|
Pass the Local Government Act (replacing the Local
Government-Urban areas-Act and Local Government-District
Councils-Act)
|
|
Jan. 1999
|
|
1998-99
World Bank
|
| |
|
|
|
Hold local elections in line with the revised Local
Elections Bill.
|
|
1999
|
|
|
|
