World Bank Confident With President Mutharika, Commits $ 70 Mn To MASAF IV As APM Meets WB VP For Africa

STATEMENT BY HIS EXCELLENCY PROF. ARTHUR PETER MUTHARIKA, PRESIDENT OF THE REPUBLIC OF MALAWI
UPON MEETING WITH THE WORLD BANK’S VICE PRESIDENT FOR AFRICA, MR. MAKHTAR DIOP

KAMUZU PALACE

23 JANUARY 2017 

• Mr. Makhtar Diop, World Bank’s Vice President For Africa, and your delegation

• Hon. Goodall Gondwe, Minister of Finance, Economic Planning and Development

• All Cabinet Ministers here present

• Ms. Bella Bird, World Bank Country Director for Malawi, Tanzania, Burundi and Somalia

• Ms. Laura Kullenberg, Country Manager for the World Bank in Malawi

• Senior Government Officials

• Members of the Press

• Distinguished Ladies and Gentlemen

I am pleased to welcome you to Malawi, especially to Kamuzu Palace. It is indeed my great pleasure to host you, Mr Vice President and your delegation.

Your coming is important to us as a country. The World Bank is an institution that plays a critical role in our Development process. Through various projects and programmes cutting across key social and economic sectors, the Bank has continued to play a very significant role in the socio-economic development of this country. We are, therefore, grateful that you took time to visit this country to hear from us and to appreciate our circumstances.

As you already know, Mr Vice President, Malawi has gone through two years of bad weather and poor agricultural output.

This has caused hunger for our people, and a slowdown in economic growth. An estimated 6.7 million Malawians have been receiving humanitarian food aid since July last year. We are thankful that the World Bank has been very supportive throughout our times of need.

Your response to our situation has always been timely and significant. In response to the crop failure in the 2015/16 agriculture season, the Bank has committed US$104 million under the Malawi Drought Recovery and Resilience Programme. This includes US$50 million for the purchase and distribution of maize to the many affected households.

The Bank has further committed some US$70 million additional financing under the MASAF IV project. The resources will be used for the social cash transfer and public works programmes. This will enable another section of the affected population to access food through the markets. The contribution of the Bank to the Social Cash Transfer Programme, together with that of other development partners, enables Malawi to achieve 100% coverage of the country.

I am further grateful, Mr President, that this year’s support is being provided against the backdrop of other life-saving interventions recently provided by the Bank. In 2015, the Bank provided US$80 million under the Malawi Floods Emergency Recovery Project, which included some US$15 million for maize purchases for humanitarian response.

I wish to assure you that, currently, the main focus of my Government is to break this cycle of food insecurity. While it is a known fact that Malawi is vulnerable to climatic shocks, the country possesses great potential to break this cycle.

To this extent, the Government has devised the National Resilience Plan to systematically break the cycle. Key in this plan is the promotion of large-scale irrigation farming to mitigate against climate change, particularly drought episodes. In this regards, my Government strongly believes that the Shire Valley Transformation Project, which the Bank is supporting, will be one of the signature projects.

My Government has recently launched a National Agricultural Policy and a National Irrigation Policy in pursuit of the same goal.

Our next step is to align agricultural production with marketing and trade policies, in order to promote private sector investments in the agricultural sector. You will be pleased to note, Mr Vice President, that this reform process is already well underway. In particular, my Government is committed to reform the Agricultural Development and Marketing Corporation (ADMARC), in order to make it responsive to these objectives.

In addition, my Government is very committed to deepen public sector reforms. We been implementing a Public Sector Reforms Programme aimed at promoting efficiency, effectiveness and professionalism in the public service. The fruits of these efforts can be seen in quite a number of areas.

We are also strengthening the planning process through the establishment of a National Planning Commission and the formulation of a new medium term development strategy.

As you will appreciate, Mr Vice President, it is imperative that the Government should have the necessary financial support in this endeavour. Therefore, it is my appeal to the Bank to consider approving the US$80 million general budget support under the Malawi Resilience Development Policy Operation. I am aware that substantial progress has been made in achieving the agreed prior actions, which shows my Government’s commitment to reform in the areas of agriculture, trade and public finance management, among others others.

We realize that the reform task before us is enormous. In some cases, it requires substantial investments. In other instances, it requires tough decisions. This, however, is a path that my Government has chosen to walk, in the interest of the country.
I am pleased to note that the Bank has committed to walk with us. Your commitment of a grant of US$15 million to the Public Sector Reforms programme is enough testimony.

On public finance management, you may wish to note that my Government has prioritized enhancement of IFMIS functionality and compliance with the Public Finance Management Act. We are committed, now more than ever before, to entrench a culture of adherence to our rules and regulations, so that the plunder of public resoures called Cashgate should never happen again in this country. Cashgate was a regrettable occurrence; one which must be prevented from ever happening again at all cost.

I am aware, Mr Vice President, that the International Development Association (IDA) 17 comes to an end in June 2017, and that the Bank is currently mobilizing for IDA 18. It is our expectation that Malawi will be allocated a substantial amount of resources, in keeping with our level of needs.

Furthermore, I hope that such money will be allocated to address our constraints to sustainable growth. The country requires catalytic interventions for socio-economic development, including heavy investments in utilities and other infrastructure, in addition to climate change mitigation and adaptation investments.

One of the main challenges that the country is facing is low power generation. As a country, we never seriously invested enough to expand the energy sector over the last fifty years. We need more resources to invest in energy projects.

Finally, I thank the World Bank for all the support that it is providing to Malawi through grants and soft loans. Such support is making a positive contribution to the socio-economic development of this country.

Once again, I thank you for being such a trusted supportive partner for Malawi.

Thank you for your visit and your attention.

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