Put your houses in order ahead of economic uncertainties and rising food prices – IMF Warns African Countries

IMFWhile it appears that the leaders in some African countries are busy building their own “private” economies by lacing their pockets with public funds, the International Monetary Fund (IMF) has called on African countries to have strong macroeconomic framework and improved institutional capacity against the backdrop of global economic uncertainty and rising food prices.

IMF Managing Director, Christine Lagarde, gave this advice at the conclusion of a visit to Malawi, saying since African countries had become increasingly integrated into the rest of the world, there was need to ensure sustainable and inclusive growth in order to maintain the impressive economic performance of the last 10 years, stating that the IMF would continue to assist them in these vital efforts.

Lagarde assured that the IMF would continue to support Malawi with technical assistance, policy advice, financial assistance under the programme supported by the Extended Credit Facility and training to strengthen capacity in macroeconomic management.

According to her, “Malawi’s recent economic situation has been difficult. Drought and lower-than-expected foreign exchange earnings have dampened growth and contributed to a spike in inflation in 2012. Notwithstanding the current hardships, many of my interlocutors are confident that the ongoing reforms will turn the economy around, an optimism that I share.”

The IMF boss further said that the present government’s bold economic policies, including the liberalisation of the foreign exchange market were a welcome development, stating that continued assistance from development partners would be essential to support the government’s reforms: “I welcome the government’s efforts to address the unforeseen challenges through her continued commitment to economic reforms. Malawi has already made significant progress in addressing the serious imbalances that were hampering economic growth just a few months ago,” she declared.

“I also stressed the need to stay the course, while putting in place social protection programs to alleviate the impact of the adjustment measures on the poorest households. Continued assistance from development partners will be essential to support the ongoing reforms,” she stated.