IMF praises Malawi's reforms but leaves without a loan deal
Two weeks of talks in Lilongwe ended with warm words on spending discipline and fuel pricing, and no agreement yet on the financing the country has lacked since May 2025.
Lilongwe — An International Monetary Fund team has ended two weeks of talks in Malawi without agreeing a new lending programme, while praising the government's economic reforms, the Nyasa Times reports.
The mission, led by Justin Tyson, was in Lilongwe from 22 September to 6 October to discuss a possible Extended Credit Facility. Any agreement would still need the approval of the Fund's management and its executive board.
What the Fund liked
The team commended what it called strong reforms to tighten fiscal discipline and reduce the public debt burden. It said domestic revenue is rising in line with the 2026/27 budget, described changes to fuel and sugar pricing as improvements, and noted that inflation is easing as food prices slow.
What still worries it
Non-food inflation remains high. The Fund said the economy faces a difficult environment because of climate shocks, falling demand for tobacco, Malawi's main export, and disruption to world trade from the conflict in the Middle East.
Malawi has had no working IMF programme since the last one lapsed in May 2025. Since then it has suffered severe shortages of foreign exchange and fuel, and a wide gap between the official and parallel exchange rates.
This report is based on reporting by the Nyasa Times, via AllAfrica.
