From the Executive Board

• Pages: 28-30

Page 28

Following are excerpts of recent IMF press releases. The full texts are available on the IMF's web site (http://www.imf.org) under the heading NEWS or on request (fax only, please) from the IMF's Public Affairs Division (fax: (202) 623-6278).

MALAWI: ESAF

The IMF approved the second annual loan under the enhanced structural adjustment facility (ESAF), in an amount equivalent to SDR 15.3 million (about $22 million), to support Malawi's economic program in 1996/97. The loan is available in two equal installments, the first of which is available on December 13, 1996.

Medium-Term Strategy, 1996-97 Program

Malawi's medium-term strategy aims to consolidate the gains achieved thus far and to sustain economic growth within a framework of financial stability.

[ GRAPHICS ARE NOT INCLUDED ]

The program for 1996-97 aims to achieve real GDP growth of about 11 percent in 1996 and 5 percent in 1997, an annual inflation rate of 8 percent by end-1997, and an increase in gross official international reserves to the equivalent of 4.5 months by end-1997. To achieve these objec-Page 29tives, the program will rely on the continued pursuit of tight financial policies. The overall budget deficit (excluding grants) will be reduced from 13.6 percent of GDP in 1995 to 9.0 percent in 1996, and to 7.6 percent in 1997.

Structural Reforms

Malawi will continue to take measures to reestablish agriculture as an engine of growth, increase food security, and alleviate poverty. The liberalization of agricultural marketing and production arrangements has already resulted in substantial improvements in the growth of smallholder production and diversification into nontraditional or drought-tolerant crops. The privatization program, which started in early 1996, aims at bringing to the point of sale 26 public enterprises in 1996/97, and 20 more in 1997/98.

Social Issues

Higher economic growth and inflation reduction are contributing significantly to poverty reduction. The government's poverty alleviation program will also continue to focus on efforts to reform agriculture to benefit smallholders, reallocate budgetary resources to the social sectors, limit population...