The World Bank and International Monetary Fund announced they are forgiving $2.97 billion worth of debts by Malawi and that the country is eligible to enjoy debt relief under the Highly Indebted Poor Countries initiative. Finance Minister Goodall Gondwe welcomed the decision. “This is a historic moment and very exciting news. It’s a major milestone and a stepping stone to getting Malawi out of poverty,” Gondwe said. The move meant a 90 percent reduction in Malawi’s external debt, which now only amounts “to just about $400 million,” according to the minister. IMF country director Thomas Baunsgaard, however, reminded Malawi to “look carefully at borrowing to avoid accumulating debt and avoid getting into a similar debt situation.”
Sources:
Donors cancel bulk of Malawi’s $2.97 bln debt (Reuters)
Malawi welcomes major milestone of debt relief (SAPA-AP)
