The World Bank has tipped Malawi and other developing countries to improve on transparency if they are to build confidence among potential Foreign Direct Investors.
The Bretton Woods’ institution says a stable investment climate is also crucial to woo investors.
The suggestions are contained in a recent news release by the bank where it has also committed to support 100 countries in their response to Covid-19.
The bank has pledge $160 billion in grants and financial support over a 15-month period to help developing countries respond to the health, social and economic impacts of Covid-19.
Recently, the World Bank approved a $100 million (about K74 billion) grant for the strengthening of local authorities’ institutional performance, responsiveness to citizens and management of resources for public service delivery.
World Bank Group president, David Malpass, said the pandemic and shutdown of advanced economies could push about 60 million people into extreme poverty, erasing much of the recent progress made in poverty alleviation.
“The World Bank Group has moved quickly and decisively to establish emergency response operations in 100 countries, with mechanisms that allow other donors to rapidly expand the programs.
“To return to growth, our goal must be rapid, flexible responses to tackle the health emergency, provide cash and other expandable support to protect the poor, maintain the private sector, and strengthen economic resilience and recovery,” Malpass said.
The Malawi economy is already facing pressure from effects of the pandemic with reduced revenue, a bloated wage bill and reduced production in the industry sector.
A recent assessment by the Reserve Bank of Malawi (RBM) revealed that if the Covid-19 continues, it might have a devastating impact on inflation as well as the stability of the financial system as the capital of institutions will be eroded.
RBM Board Director, Pius Mulipa, said the impact of the pandemic on both the international and domestic economies is unprecedented and surpasses any economic crisis since the depression.
