UN urges more domestic financing

United Nations (UN) has urged Malawi to do more in expanding domestic financing for development, saying “it cannot be business as usual” in the face of emerging aid cuts.

UN resident coordinator in Malawi Rebecca Adda-Dontoh made the call in Lilongwe during the launch of two strategic financing instruments, the Integrated National Financing Framework (INFF) and the Malawi SDG Investor Map.

The two tools are designed to close financing gaps, align public and private investment with national priorities under Malawi 2063 and strengthen the country’s resilience amid macroeconomic challenges.

She said there is a need for more innovative and practical solutions to bridge the financing gap.

Adda-Dontoh cited the Addis Ababa Action Agenda which encourages governments, international organisations, the private sector and civil society to do more to increase financial resources for sustainable development.

“The global development financing landscape is facing significant headwinds, marked by recent policy shifts and aid cuts. This amplifies the need for developing countries, like Malawi, to do more in expanding domestic financing for development,” she said.

On the other hand, European Union Ambassador to Malawi Rune Skinnebach urged the country to overtake regional competitors by implementing policy commitments.

The officials during the launch of the documents. | Nation

He said there is huge commitment for investment while urging Malawi government’s commitment to private sector development to be stronger than that of neighbouring countries.

“It is not enough to create a predictable and secure investment climate. We also need to create an investment climate which is more attractive than neighbouring countries,” he said.

World Bank country manager Firas Raad painted a positive picture for Malawi, saying the challenges facing Malawi are not invincible.

He advised that it will take a lot of work to achieve Malawi 2063 targets for 2030 and 2063, observing that modernisation takes decades of sustained reforms.

“Malawi can take heart that many countries have been able to make the transition from low income to middle income and then upper income to high income,” he said.

Minister of Finance Simplex Chithola Banda advised government agencies to integrate the INFF into their planning while urging the private sector to explore the Investor Map and create solutions.

Among others, INFF provides a comprehensive strategy to increase domestic revenue, enhance budget credibility and align financing with national development priorities.

It also promotes policy reforms, sustainable debt management, and innovative financing instruments apart from strengthening local financial systems to promote inclusion.

Malawi SDG Investor Map seeks to identify commercially viable, high-impact investment opportunities aligned with Malawi 2063 and the Sustainable Development Goals.

It also works to address private investment barriers through de-risking tools and supportive policy environments.

In an interview yesterday, National Planning Commission acting director general Joseph Nagoli said the two documents are detailing how the country can finance its development as part of accelerating development trajectory.

He noted that Malawi needs to look beyond the national budget in financing development, saying financing can be through public private partnerships for example in road infrastructure.

“We cannot only rely on the national budget for development. We need alternative financing and that is why we have the two documents.

“Fiscal space for development is very small so we cannot rely on the 20 percent development to develop this country,” he said.

As a key enabler of the Malawi 2063 First 10-Year Implementation Plan (MIP-1), Effective Governance Systems and Institutions was allocated K3.6 billion, representing 45 percent of the 2025/26 National Budget.

The Human Capital Development enabler was allocated K2.4 billion, representing 30 percent of the budget.

Enhanced Public Sector Performance was allocated K457.3 billion, Economic Infrastructure received K453.7 billion, Environmental Sustainability got K29.8 billion and Mind-set Change got K6.6 billion while Private Sector Dynamism received K5.5 billion.

As pillars of the MIP-1, Agricultural Productivity and Commercialisation received K738.9 billion, Urbanisation was allocated K190.6 billion and Industrialisation got K93.8 billion.

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