Malawi: Technical Assistance Report-Report on Data Quality Assessment for Public Sector Debt Statistics Mission (January 29-February 4, 2025)

This report discusses the findings and recommendations of a diagnostic assessment of the quality of public sector debt statistics (PSDS) of Malawi based on the IMF’s Data Quality Assessment Framework for PSDS. The assessment was undertaken in February 2025 as part of a project to strengthen the quality of public sector debt data in select African countries, funded by the Government of Japan. Like many low-income countries, Malawi is facing challenges servicing its public debt. The latest joint IMF-World Bank debt sustainability analysis of January 2024 indicates that the country is in debt distress. The authorities have taken measures lately to strengthen governance and transparency of public debt. In 2022, Malawi enacted a new Public Finance Management Act providing a legal framework for government borrowing as well as the issuance and management of guarantees by government including guarantees to State-owned enterprises. The key recommendations of the diagnostic assessment include enacting a new legislation to address public debt management operations in line with the practice in the region; expanding the sector coverage of public debt beyond the budgetary central government; expanding instrument coverage to other accounts payables; reconciling stocks and flows and publishing the results transparently; enhancing the frequency of public debt reports and reactivating the dissemination of debt through the National Summary Data Page as well as the joint IMF-World Bank Quarterly Public Sector Debt statistics database. The authorities have adopted recommendations and developed an action plan to implement them in a phased manner.