Malawi becomes the first country to open the IMF’s new ‘Food Shock Window’

The International Monetary Fund (IMF) has a new financing tool called the ‘Food Shock Window’ to address balance of payments needs linked to the global food crisis. Malawi, where hunger among the poor is common, is the first low-income country to open that window.

Under the “staff-level agreement”, in IMF-speak, Malawi will receive up to $88.3-million in emergency financing. 

Hunger periodically stalks the warm heart of Africa, especially at the start of the grain-planting season when most of the previous season’s crop has been consumed. 

“This emergency financing under the new Food Shock Window will help Malawi address urgent balance of payments needs related to the global food crisis. 

“Program Monitoring with Board involvement will support the government’s economic reforms to restore macroeconomic stability and provide the foundation for an inclusive recovery,” the Washington-based lender said in a statement. 

Cutting through the buzz terms such as “inclusive recovery”, the bottom line is that impoverished Malawi is once again hungry, and soaring food and fertiliser prices, linked in part to Russia’s invasion of Ukraine, have exacerbated a situation that was probably grim in the first place.

Source: Daily Maverick