Malawi: IMF Praises Malawi Reforms but Holds Off On New Financing Deal

What the report says

An International Monetary Fund team has ended two weeks of talks in Malawi without finalising a new lending programme, according to Nyasa Times reporting distributed by AllAfrica. The mission, led by IMF mission chief Justin Tyson, met authorities in Lilongwe from 22 September to 6 October to discuss a possible arrangement under the Fund’s Extended Credit Facility.

The IMF said Malawi had made progress on reforms aimed at tightening fiscal discipline, reducing public debt and improving market functioning. It also cited stronger domestic revenue collection, spending restraint under the government’s National Economic Recovery Plan, and recent changes to fuel and sugar pricing as signs of improvement. At the same time, the Fund noted that inflation had eased somewhat because of lower food inflation, while non-food price growth remained elevated.

Despite the positive assessment, the IMF did not announce a deal. It said discussions had made substantial progress on a policy package that could support a loan programme, but more talks are needed. Any eventual agreement would still require IMF management approval and then Executive Board consideration.

The report adds that Malawi has been without an active IMF programme since the previous arrangement expired in May 2025. That gap has come amid foreign exchange shortages, fuel supply problems and a wide spread between official and parallel-market exchange rates, all of which make new external financing especially important for the country’s economic stabilisation.