JOHANNESBURG (Reuters) -Malawian authorities have started debt restructuring negotiations with commercial creditors and a ‘credible process’ is underway, the International Monetary Fund said on Tuesday.
Malawi’s move to an upper credit tranche IMF programme will depend on the progress of the debt restructuring, which is difficult to predict, IMF’s Mika Saito said in an online press conference.
The International Monetary Fund said its executive board on Monday approved an $88.3 million disbursement to Malawi under the new “food shock window” emergency lending facility launched in response to food price spikes and shortages caused by Russia’s war in Ukraine.
The IMF also said the executive board assessed that a previously approved staff-monitored policy program for Malawi linked to the food shock loan is “sufficiently robust to meet the stated objectives” and was expected to build a track record of policy implementation that could lead to a more formal IMF “upper credit tranche-quality” loan arrangement.
(Reporting by Rachel Savage; Writing by Bhargav Acharya; Editing by Estelle Shirbon)