The International Monetary Fund (IMF) on Monday hailed Malawi’s 2012/13 K406 billion budget presented last Friday and describing it as pro-poor and business friendly.

IMF Resident Representative for Malawi Ruby Randall told Zodiak in an email response that she hopes “successful passage of the budget will help pave way for IMF Executive Board’s approval of the new Extended Credit Facility program”.

An IMF special team that concluded its mission last week said will ask the IMF board in US to consider Malawi for a new three year program worth 157 million dollars.

“The budget appears sound and balanced, and consistent with Malawi’s Growth and Development Strategy,” added Randall.

The budget has seen various taxes introduced in last year’s Zero deficit Budget like VAT on bread and newspapers scrapped off.

Finance Minister Ken Lipenga told parliament that key measures in the 2012/13 budget are restoration of donor aid which has been projected at K124 billion and suspension of domestic borrowing.

Lipenga also said is that inflation will rise to 18 percent the highest since 2004.