Malawi’s cash-gate scandal

27 February 2014

In January, the IMF disbursed around $20 million to Malawi having previously suspended disbursements to Malawi n October because of allegations of massive looting of government money, which erupted in September 2013. In February, a forensic audit report conducted by independent auditors had been submitted to the IMF prior to its decision to restart disbursements. John Kapito of the Consumer Association of Malawi complained that the IMF’s decision to release the disbursement “smells of double standards and a lack of understanding of local economics and politics”.

CSOs in Malawi including the Centre for Human Rights and Rehabilitation (CHRR) and Centre for the Development of People (CEDEP) voiced their dissatisfaction with the government for ignoring their demand to make the audit report public and more transparent. In a joint statement in January they said that “the publishing of the two documents will clear the suspicion as well as enhance the credibility and acceptability of the forensic audit by the general public.”

Kapito explained that “the $20 million [disbursement] by the IMF is seen as a slap in the face of the many Malawians who until today are not told the events surrounding the cash gate looting”, adding that he is “happy that … [Malawi’s] donors have not followed the IMF’s direction”. Malawi’s donors that withheld funds are, according to reports, planning to meet in March to discuss whether to release aid funds.