Sunday 18-May-2025 [SJN]: The recent decision by the Government of Malawi to mutually suspend the Extended Credit Facility (ECF) with the International Monetary Fund (IMF) is not just a technical economic shift — it is a bold and people-centered policy stance.
Special commendation must go to the Minister of Finance, Simplex Chithyola Banda, whose steady leadership and principled negotiation have ensured that Malawi does not bow to pressure that undermines the dignity and welfare of its citizens. This is a clear signal that the Malawi Congress Party (MCP)-led government is prioritizing the needs of Malawians over the demands of external financiers whose conditions often hurt more than they help.
Contrary to alarmist narratives pushed by some opposition figures, Malawi has now run eight months without the ECF, and the sky has not fallen. In fact, we are witnessing the gradual stabilization of key sectors, renewed focus on domestic revenue mobilization, and a deliberate effort to protect vulnerable citizens from the economic pain that IMF conditions had inflicted.
The opposition’s claims that suspending the facility is a sign of economic mismanagement are not only misleading — they lack logic and historical honesty. It was under the previous Democratic Progressive Party (DPP) administration, with Dalitso Kabambe as Reserve Bank Governor, that the IMF was deceived with doctored figures. These manipulated numbers gave a false sense of macroeconomic stability, but they masked deep structural problems that Malawians felt every day.
In contrast, the current Malawi Congress Party (MCP)-led government under President Lazarus Chakwera has chosen transparency over deception, and integrity over illusion. It has taken the harder, more honest path: to face the IMF with clean data and unvarnished economic realities — even if it meant walking away from conditional aid.
The IMF: Changing Goalposts and Blocking Development
It is important for Malawians to understand that the IMF was not just placing tough economic conditions — it was constantly shifting its goalposts and opposing Malawi’s sovereign development agenda. Here’s the truth:
1. They told us to devalue the Kwacha — and we did. The impact was devastating: prices soared, and inflation deepened. But that still wasn’t enough for them.
2. They wanted fuel prices adjusted — we said no. Our government stood firm because Malawians were already suffocating under high transport costs.
3. They demanded electricity tariff hikes — we said no. Raising electricity bills would have hurt both poor households and small businesses.
4. They wanted civil servants’ salaries slashed — we said no. A government that values its people cannot punish its teachers, nurses, police officers, and other frontline workers.
5. They wanted us to freeze public recruitment — we said no. The MCP government believes that our youth deserve opportunities — not rejection.
6. They opposed key national development projects like the Magwero Industrial Park and the Lilongwe-Salima Water Project.
These projects are essential for job creation, water security, and industrial transformation — but the IMF saw them as fiscal liabilities.
How can we partner with an institution that sees progress as a threat, and sovereign development as a problem?
A Decision for the People
Malawi’s break from the ECF is not a rejection of fiscal prudence, but a demand for a more humane and citizen-focused path to economic recovery. For once, the government has prioritized the lived realities of its people over the spreadsheets of foreign technocrats.
The MCP-led government deserves credit for not taking the easy path of deception. Instead of “cooking figures” to appease international partners — as was done under the DPP — it has been honest, accountable, and willing to own up to economic challenges.
It is this integrity-driven leadership that will form the bedrock of sustainable development. We must not go back to the days of artificial statistics and cosmetic macroeconomic wins that mean nothing to the ordinary Malawian.
The Future Is Ours to Shape
Malawi is not turning its back on international cooperation. It is turning its face toward its people. This suspension is a reset — a chance to define our own path, embrace local solutions, and reform in a way that uplifts everyone, not just the elite.
To President Lazarus Chakwera, Finance Minister Simplex Chithyola Banda, the entire cabinet and the Malawi Congress Party: thank you for choosing the people over pressure. Thank you for proving that patriotism is not in rhetoric but in the courage to make tough, pro-people decisions.
Let history record this moment as the point when Malawi stood tall and declared: “We choose our people first.”
Source: Medium
If you have any question(s) regarding this article let us know by editorial@somalidutchuk.nl