Tuesday, 8 January 2013

IMF and Malawi: Here We Go Again?

Christine Lagarde is off to Malawi where IMF-recommended reforms have been (fairly aggressively) implemented in something of a catch-up run since Joyce Banda took office. Much was expected from the long-awaited reforms, which included a currency devaluation. The results have been less than impressive. Inflation has spiked, pushing up already-sky-high food, fuel and medicine prices, foreign exchange has been lack-lustre and a drought has left thousands struggle with hunger and food insecurity.

The IMF does not have a great track record with Malawi, with many still holding them responsible for, or at least maintaining complicity in, the 2001/2002 famine in the country - a disaster that resulted partly from the implementation (and, granted, the government's interpretation) of the IMF's recommendations. The IMF chief may not be received with the warmth she is expecting.

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