A team from the
"Preliminary indications are that real Gross Domestic Product (GDP) growth in 2014 will be in the 5-6 percent range with strong contributions from the agriculture, information and communications, and wholesale and retail trade sectors. The ready availability of foreign exchange and fuel resulting from continuation of the flexible exchange rate regime and automatic fuel price adjustment mechanism will also support economic activity.
"The annual rate of inflation has been declining gradually in recent months, but remains high at 22.6 percent in May. The cashgate scandal and the associated loss of most budget support from
"Performance under the ECF-supported program has been mixed. The
"Looking forward, public resources are significantly constrained due to the high interest cost of domestic debt and the need to address a significant accumulation of domestic payment arrears. In the face of such a tight budget constraint, fiscal discipline will be critical to ensuring that spending is kept in line with available resources. In this regard, the authorities intend to make some of their budgetary outlays in Fiscal Year 2014/15 contingent on disbursements of external assistance from
"The mission strongly supports the government's intention to continue reforms in public financial management. It welcomes the authorities' plan to consolidate the diverse reform elements under one organizational structure. Aggressive implementation of the strategy, well coordinated with other stakeholders, has the potential to deliver the improvements needed to protect public resources, improve the efficiency of their allocation, and re-establish a degree of public confidence and trust.
"The authorities have requested that the IMF mission return to
"The mission met His Excellency President Arthur Peter Mutharika, Minister of Finance and Economic Planning and Development Goodall Gondwe,
"The mission expresses its gratitude for the constructive spirit in which discussions with the authorities and all stakeholders were held."
1 The Extended Credit Facility (ECF) has replaced the Poverty Reduction and Growth Facility (PRGF) as the Fund's main tool for medium-term financial support to low-income countries by providing a higher level of access to financing, more concessional terms, enhanced flexibility in program design features, and more focused streamlined conditionality. Financing under the ECF currently carries a zero interest rate, with a grace period of 5dz years, and a final maturity of 10 years. The Fund reviews the level of interest rates for all concessional facilities every two years.
TNS 30BautistaJude 140717-4798352 30BautistaJude
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