EU resumes budgetary support to Malawi after 10-year hiatus

The European Union (EU) has committed to renewing its partnership with Malawi to help accelerate the achievement of sustainable solutions by introducing a new budget support programme of EUR 55 million.

The Budget programme, ‘Malawi State and Resilience Building Programme,’ will target the education sector and Public Finance Management (PFM).

Speaking in Lilongwe on Wednesday during the signing of the financing agreement with the government of Malawi, EU ambassador, Rune Skinnebach said the event is a powerful symbol of renewed collaboration and commitment to shared goals of stability, progress and inclusive development in Malawi.

“The EU believes that effective PFM will help safeguard public resources, build stronger governance systems and create fiscal space necessary for targeted investments in critical sectors such as education, health, and infrastructure.

“Investing in secondary education is investing in the future of Malawi. It is about expanding opportunities for the next generation, equipping young people with the skills they need, and creating an environment where every student has a fair chance to succeed,” he explained.

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Skinnebach called on the government to improve PFM and meet a series of indicators including Integrated Financial Information Management Systems (IFIMS) but also in education where current expenditure levels must be increased, to maintain the programme.

Minister of Finance and Economic Affairs, Simplex Chithyola said the Malawi budget had been run with a huge deficit because they could not get enough resources to implement several programs, after a decade without donor budget support.

“The coming in of such a huge sum of money as budget support is an indication of the degree of confidence and trust, in Malawi’s leadership and reform programs,” said Chithyola.

Chithyola said their ministry will ensure the use of the resources for their intended purposes and appealed to implementers to practice prudence but also financial probity.

In her remarks, Minister of Education, Madalitso Wirima Kambauwa thanked the EU for the continued support in the education sector for over 10 years.

“the program will support reforms in several areas including ensuring secondary bursary schemes are more efficient and transparent, reforms aimed at improved teacher management and strategies and reforms for ensuring effective models for teacher education sector budget.

The new program aligns with the government of Malawi’s priorities under Malawi 2063, as well as the European Union’s Global Gateway investment strategy, which aims to support a strong inclusive, green and digital transformation in the country while enhancing living standards and promoting long-term, inclusive growth.