Malawi is set to benefit from about $200-million and part of a $1-billion farm input fund from the African Development Bank (AfDB) due to its impressive economic growth, the bank’s president said on Thursday.
The AfDB Group said it will double its soft loan window funding to Malawi from $80-million to just under $200-million, while the country would also receive part of $1-billion provided by the bank to subsidise fertilizers and farm inputs.
AfDB president Donald Kaberuka told a news conference in Lilongwe that Malawi’s phenomenal economic growth in recent years and the reduction of inflation from 15% in June 2006 to single digits in 2007 encouraged the bank to increase its loans.
”Malawi is a very poor country but it is registering credible economic growth and the macro economic conditions look quite good when other countries are stagnating. We are pleased with the performance and our allocation of resources is based on that,” he said.
Malawi remains one of the poorest countries in the world, but has enjoyed a relative economic boom over the last three years boosted by good agricultural output inspired by good rains.
The country’s economy was expected to expand by 7% in the 2008/09 financial year, with inflation rising to 8,5% year-on-year in June, from 7,9% previously. Economic growth measured 8% in the 2007/08 financial year.
Kaberuka, who also opened the AfDB’s country office in Malawi, said the country would be one of several nations to benefit from the $1-billion fund to subsidise fertilisers and farm inputs.
”Again based on performance of countries like Malawi, were the fertiliser subsidy has been very intelligently used, it is our obligation to support such countries and I want to confirm that we will do that,” he said.
Over half a billion dollars has been pumped into Malawi’s economy since 1972, when the AfDB first began its operations in the country. The group presently has nine operations worth $170-million in Malawi. – Reuters