IMF happy with interim progress

Malawi's economic policy reforms have begun to pay dividends, according to the International Monetary Fund (IMF). An IMF team is visiting Malawi to review the country's progress on tightening fiscal discipline, and measure the new government's performance in terms of macroeconomic reform. The IMF suspended aid to Malawi during the tenure of the previous president, Bakili Muluzi, because of alleged corruption, poor governance and over-expenditure. IMF director for Africa Abdoulaye Bio-Tchane said the present government's economic policy reforms were paying dividends and urged it to continue on that path. "I am impressed with the way government is addressing economic problems, especially the stand taken in tackling corruption and controlling expenditures," Bio-Tchane said after meeting with President Bingu wa Mutharika, MPs, civil society representatives and Reserve Bank of Malawi officials. Finance minister Goodall Gondwe promised that government would continue its policy of tackling corruption and graft, but cautioned that economic performance still needed to improve. Over the past six months Malawi's GDP has grown from 3.7 percent to 4.3 percent. "We will start patting ourselves on the back once the growth rate reaches 6 percent or more - now, there is very little we can celebrate about," said Gondwe. An estimated 65 percent of the country's 12 million people live below the poverty line. Government spokesman Ken Lipenga noted that domestic borrowing had been contained at MK46.9 billion (US $4.4 million), against the projected amount of MK53.8 billion ($5 million) by December 2004, and the inflation rate stood at 12 percent between July and December against an IMF projection of 18 percent.