Malawi will introduce austerity measures this year to deal with a hole in its finances left by a British government aid freeze, Finance Minister Ken Kandodo said on Friday.

“Clearly the 2011/12 financial year resource envelope will fall short of our expectations in view of the British decision,” Kandodo told Reuters.

“But Malawi is ready to make tough decisions and choices on spending cuts in order to sustain growth and be able to deliver public services.”

Reuters.

Part 2

Malawi has lost aid from Britain and Germany after expressing concerns about poor governance in the country. This decision, according to Nyasa Times, was taken because of President Bingu wa Mutharika’s dictatorial rule.

According to the Nyasa Times, President Mutharika accused some donors of working with the civil society to undermine his administration.

Mutharika deported British High Commissioner Fergus Cochrane-Dyet in February 2011 for calling him as “autocratic” and “combative”.

Mutharika is also on record as saying that some donors are working with the civil society to undermine his administration.

Britain froze new aid until a review of its ties with the country after mutual expulsion of diplomats, the Malawi Voice reported. A statement released by the Department of Internatinal Development (DFID), a British aid arm, said the UK is reviewing its relations with Malawi, including DFID’s aid programme. New aid commitments are on hold until the review is completed.

Nyasa Times also reported that the German enbassy will close its mission in Malawi in the next 12 months.

The donors are concerned with violation of freedom of the press and expression, lack of accountability and human rights abuse, according to reports.

The country is heavily reliant on donors, with budgetary support containing for over 40% of the national budget, the Malawi Voice has reported.