News / Africa

    Malawi: Donors Withhold Aid Over Cashgate Scandal

    FILE - Malawi President Joyce Hilda Mtila Banda addresses the 68th session of the United Nations General Assembly.
    FILE - Malawi President Joyce Hilda Mtila Banda addresses the 68th session of the United Nations General Assembly.
    Lameck Masina
    Several donor nations are withholding aid to Malawi in reaction to a growing scandal over government graft known as Cashgate. The latest to announce the delay of funding are donors under the Common Approach to Budget Support (CABS) who are meeting in the capital, Lilongwe. Government authorities say this is likely to pose economic problems in a country where 40 percent of its national budget comes from donor aid.

    Announcing the move during its first review meeting of the 2013-2014 budget on Thursday, the funding group said it has decided to delay its aid to Malawi after its loss of confidence in the government’s financial system.  The so-called Cashgate scandal has thus far resulted in the looting of more than $250 million from government coffers.

    Sarah Sanyahumbi is co-chair of the CABS group and head of Department for International Development (DFID) in Malawi.

    “It is clear from what we already know, even though investigations are ongoing, that there are serious weaknesses in the government’s financial systems which allowed [what] we call Cashgate to actually happen. So we have seen serious weaknesses which have enabled people to take money out of the government system. While that is the case, you know the donors cannot responsibly continue to put money into government systems. So at the moment, while the investigations are going on, we have delayed any funding which was planned to go into the government system," said Sanyahumbi.

    The decision comes a few days after the European Union and DFID withheld their funding to Malawi until authorities come to the root of the financial looting. Norway has completely suspended its funding to Malawi because of the problem.
     
    Sanyahumbi, however, believes not all is lost.

    “[But] that doesn’t mean that all development support to Malawi has stopped. It’s budget support and sector budget support [that has been affected]. So all other programs or projects like in health, education, food security, etc. etc. are still ongoing," she said.

    But Finance Minister Maxwell Mkwezalamba pleaded for mercy from donors, saying the suspension of budget support for Malawi spells doom for the country.
     
    “We are concerned with the decision to delay this disbursement. The impact on the economy on Malawi people will not be good. When you look at what we were expecting for this quarter alone, we were looking at $150 million, and if it doesn’t come, which is likely to [because of] the case, this means we have to have another look at our budget framework," said Mkwezalamba.

    He assured donors that the government has an action plan that will help get to the root of the issue and bring to justice the culprits in the looting.

    But Sanyahumbi said there is no turning back because the “line” already has been crossed.

    “Really, we expect significant commitment to action to be taken. We are talking about an extraordinary path. This is not business as usual. As far as we are concerned, the line has been crossed, so once the line has been crossed you cannot go back to what you had before," she said.

    An International Monetary Fund (IMF) team is in the country on a make-or-break mission to gather information on the Cashgate scandal.

    Its weeklong fact-finding efforts will determine Malawi's fate on whether the IMF will further disburse its $20 million under the Extended Credit Facility.

    You May Like

    Video Democrats Clinton, Kaine Offer 'Very Different Vision' Than Trump

    In a jab at Trump, Clinton says her team wants to 'build bridges, not walls'; Obama Hails Kaine's record; Trump calls Kaine a 'job-killer'

    Turkey Wants Pakistan to Close Down institutions, Businesses Linked to Gulen

    Thousands of Pakistani students are enrolled in Gulen's commercial network of around two dozen institutions operating in Pakistan for over two decades

    AU Passport A Work in Progress

    Who will get the passport and what the benefits are still need to be worked out

    By the Numbers

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    In State of Emergency, Turkey’s Erdogan Focuses on Spiritual Movementi
    X
    July 22, 2016 11:49 AM
    The state of emergency that Turkish President Recep Tayyip Erdogan has declared is giving him even more power to expand a purge that has seen an estimated 60,000 people either arrested or suspended from their jobs. VOA Europe correspondent Luis Ramirez reports from Istanbul.
    Video

    Video In State of Emergency, Turkey’s Erdogan Focuses on Spiritual Movement

    The state of emergency that Turkish President Recep Tayyip Erdogan has declared is giving him even more power to expand a purge that has seen an estimated 60,000 people either arrested or suspended from their jobs. VOA Europe correspondent Luis Ramirez reports from Istanbul.
    Video

    Video Scientists in Poland Race to Save Honeybees

    Honeybees are in danger worldwide. Causes of what's known as colony collapse disorder range from pesticides and loss of habitat to infections. But scientists in Poland say they are on track to finding a cure for one of the diseases. VOA’s George Putic reports.
    Video

    Video Wall Already Runs Along Parts of US-Mexico Border

    The Republican Party’s presidential nominee, Donald Trump, gained the support of many voters by saying he would build a wall to keep undocumented immigrants and drugs from coming across the border from Mexico. Critics have called his idea impractical and offensive to Mexico, while supporters say such a bold approach is needed to control the border. VOA’s Greg Flakus has more from the border town of Nogales, Arizona.
    Video

    Video New HIV Tests Emphasize Rapid Results

    As the global fight against AIDS intensifies, activists have placed increasing importance on getting people to know their HIV status. Some companies are developing new HIV testing methods designed to be quick, easy and accurate. Thuso Khumalo looks at the latest methods, presented at the International AIDS conference in Durban, South Africa.
    Video

    Video African Youth with HIV Urge More Support

    HIV, the virus that causes AIDS, is the top killer of teens in sub-Saharan Africa. But many youths say their experience with the virus is unique and needs to be addressed differently than the adult epidemic. VOA South African Correspondent Anita Powell reports.
    Video

    Video Poor Residents in Cleveland Not Feeling High Hopes of Republican Convention

    With the Republican Party's National Convention underway in Cleveland, Ohio, delegates and visitors are gathered in the host city's downtown - waiting to hear from the party's presidential candidate, Donald Trump. But a few kilometers from the convention's venue, Cleveland's poorest residents are not convinced Trump or his policies will make a difference in their lives. VOA's Ramon Taylor spoke with some of these residents as well as some of the Republican delegates and filed this report.
    Video

    Video Pop-Up Art Comes to Your Living Room, Backyard and Elsewhere

    Around the world, independent artists and musicians wrestle with a common problem: where to exhibit or perform? Traditional spaces such as museums and galleries are reserved for bigger names, and renting a space is not feasible for many. Enter ArtsUp, which connects artists with venue owners. Whether it’s a living room, restaurant, office or even a boat, pop-up events are bringing music and art to unexpected places. Tina Trinh has more.
    Video

    Video With Yosemite as Backdrop, Obama Praises National Parks

    Last month, President Barack Obama and his family visited some of the most beautiful national parks in the U.S. Using the majestic backdrop of a towering waterfall in California's Yosemite National Park, Obama praised the national park system which celebrates its 100th anniversary this year. He talked about the importance of America’s “national treasures” and the need to protect them from climate change and other threats. VOA’s Julie Taboh reports.
    Video

    Video Counter-Islamic State Coalition Plots Next Steps

    As momentum shifts against Islamic State in Iraq, discussions are taking place about the next steps for driving the terrorist group from its final strongholds. Secretary of State John Kerry is hosting a counter-IS meeting at the State Department, a day after defense ministers from more than 30 countries reviewed and agreed upon a course of action. VOA Pentagon correspondent Carla Babb reports.
    Video

    Video Russia's Participation at Brazil Olympic Games Still In Question

    The International Olympic Committee has delayed a decision on whether to ban all Russian teams from competing in next month's Olympic Games in Brazil over allegations of an elaborate doping scheme. The World Anti-Doping Agency recently released an independent report alleging widespread doping by Russian athletes at the 2014 Winter Olympics in Sochi. So far, only Russian track and field athletes have been barred from the Summer Games in Brazil. VOA's Zlatica Hoke has more.
    Video

    Video Scotland’s Booming Whisky Industry Fears Brexit Hangover

    After Britain’s vote to leave the European Union, Scotland’s government wants to break away from the United Kingdom – fearing the nation’s exports are at risk. Among the biggest of these is whisky. Henry Ridgwell reports on a time of turmoil for those involved in the ancient art of distilling Scotland’s most famous product.
    Video

    Video Millennials Could Determine Who Wins Race to White House

    With only four months to go until Americans elect a new president, one group of voters is getting a lot more attention these days: those ages 18 to 35, a generation known as millennials. It’s a demographic that some analysts say could have the power to decide the 2016 election. But a lot depends on whether they actually turn out to vote. VOA’s Alexa Lamanna reports.

    Special Report

    Adrift The Invisible African Diaspora