The European Union has announced that it won’t be releasing any budget support aid to Malawi contradicting President Peter Mutharika’s claims that they would release funds.
Mutharika met Adris Piebalgs, the EU commissioner for development in New York at the United Nations last year and announced that the EU would be giving aid to Malawi again.
But treasury officials and the EU in Malawi have confirmed that the policy on budget aid has changed and they won’t be giving budget support this time around.
“The change of policy does not only affect Malawi but all other states where EU is operating,” Director of Debt at Treasury Peter Simbani told the Nation newspaper
Donors are withholding budget support to Malawi and have demanded that government among other things convicts suspects in the cash-gate scandal and tightens the public finance management system.
The UK, German and other leading donors in Malawi are yet to show any confidence in the Mutharika administration which has already been rocked by another scandal at the National Aids Commission leading to the suspension of funding by the Global Fund.
Government can’t do without donor support because it traditionally accounts for about 40 percent of the national budget.