By Burnett Munthali
President Lazarus Chakwera has described the government’s decision to allow the International Monetary Fund (IMF)’s four-year Extended Credit Facility (ECF) programme to lapse as a “necessary evil.”
He made the remarks in response to questions surrounding Malawi’s economic management and its current relationship with international financial institutions.
Chakwera said the decision was made with the country’s long-term economic stability in mind, despite the potential short-term difficulties.
He emphasized that maintaining the programme under the previous terms would have restricted Malawi’s ability to implement certain economic reforms.
The president said government had to weigh the consequences and ultimately chose a path that offered greater policy flexibility.
He acknowledged that the lapse has triggered concern among development partners and financial stakeholders.
However, Chakwera insisted that the move allows Malawi to reset and renegotiate terms that are more aligned with its national interests.
He reiterated that economic sovereignty should not be compromised for the sake of financial support that imposes heavy conditions.
The president also highlighted that discussions with the IMF are still ongoing and that the door remains open for a new, restructured programme.
He expressed optimism that Malawi will soon re-engage the IMF under terms that reflect the country’s priorities and protect vulnerable populations.
The decision to let the ECF lapse comes at a time when Malawi is grappling with high debt levels, forex shortages, and rising inflation.
Analysts have warned that the move could affect investor confidence and delay budgetary support from key donors.
But government maintains that the decision marks a turning point in how it wants to shape economic policy and fiscal discipline.
The coming months will reveal whether this “necessary evil” was indeed a calculated risk that can steer the country towards financial recovery and sustainable growth.
