Malawi Country Partnership Framework – A Focused and Flexible Engagement Strategy

The Malawi Country Partnership Framework (FY21-25) supports the country's goal of creating more jobs, strengthening human capital and increasing economic growth and accountability. Informed by extensive consultations with a broad range of stakeholders including the government, civil society organizations and development partners, the CPF is aligned with Malawi's strategic development priorities on self-reliance and economic transformation as outlined in Malawi's recently-launched vision document, Malawi 2063 (MW2063).

Malawi's recently launched vision document, 'Malawi 2063' (MW2063) targets lower-middle-income status by 2030 through a focus on three pillars: commercial agriculture, urbanization, and industrialization.

Malawi At a Glance

Around 85% of Malawi's population is estimated to live in rural areas and rely on rainfed agriculture for employment. Rapid population growth and climate change have a greater impact on Malawi's development agenda because they continue to strain the natural resource base.

While projections for growth to recover stand at 2.8% in 2021 and 3.0% in 2022, Malawi's outlook for economic recovery will depend on the evolution of the COVID-19 (coronavirus) pandemic and the government's policy actions.

Malawi Country Partnership Framework FY21-25

Malawi's CPF for FY21-25 targets three strategic areas; reinforcing foundations for growth and accountability; promoting private sector-led jobs and livelihoods; and strengthening human capital development. In addition, the CPF pays special attention to two cross-cutting issues of women's empowerment and digital development. These priority areas are guided by Malawi's development vision as laid out in the MW2063, which targets the country's lower-middle-income status by 2030 through a focus on three pillars: commercial agriculture, urbanization, and industrialization, as well as the 2018 Systematic Country Diagnostic (SCD) and with the forthcoming IFC-led Country Private Sector Diagnostic (CPSD).

Strategic Area 1: Bolstering foundations for growth and accountability

This area adopts a new and flexible approach to address selected, long-standing governance challenges that Malawi has been grappling with over the years. The WBG will therefore help strengthen citizen voice and the demand for good governance. This area will also support ongoing government reforms to increase agricultural productivity and market access, increase access to reliable energy and strengthen fiscal management and governance. The overarching objective is to support the revived reform agenda and amplify the calls for greater transparency over public finances.

Strategic Area 2: Promoting private sector-led jobs and livelihoods

In the face of negative consequences due to the COVID-19 pandemic, this focus area targets key short and long-term strategies for boosting job creation and fostering sustainable livelihoods. Presently, Malawi has an opportunity to overhaul its enabling environment for business and create new opportunities for women- and youth-led MSMEs, with a major focus on commercial agriculture and regional trade. Additionally, improving agribusiness, energy production and access, and connectivity investments to support economic diversification for Malawi will drive the job creation agenda. This focus area will also aim at increasing access to finance, entrepreneurship, and digital infrastructure to transform the potential of MSMEs in Malawi.

Strategic Area 3: Strengthening human capital development

Recognizing that human capital builds the pathway for young people to access jobs in today's changing world of work, the CPF will address key bottlenecks to deepen gains that Malawi has already achieved. The CPF will therefore focus on accelerating the demographic dividend through targeted health systems strengthening. While WBG will ensure that financing is available to support Malawi's health system response to the COVID-19 pandemic, proposed new investment in human capital development will help consolidate existing efforts by to upgrade Malawi's health systems with a focus on women and girls' empowerment. To address low learning outcomes at the lower primary level and significant gaps in the education sector, a programmatic approach to address systemwide inefficiencies in spending and provide targeted and needs-based financing to fully address constraints will be applied.

Mainstreaming Gender

In the implementation of the CPF, the WBG will establish a portfolio-based approach to responding to the high-risk of sexual and gender-based violence and will aim to support a national approach. Guided by the GBV Good Practice Note launched in October 2018, the WBG will apply new standards in SGBV risk identification, mitigation, and response to all new operations in sustainable development and infrastructure sectors.

Accelerating Digital Development

While 88% of the population lives in areas covered by mobile broadband networks, fewer than one-fifth of Malawi's residents actually use the mobile internet due to low affordability, high cost of smartphones, and lack of digital skills. The WBG will promote further adoption of whole-of-government digital solutions, including e-procurement, that simplify procedures, are more accessible to citizens, and are accompanied by policies that promote greater transparency.

Foundations for Success

For the CPF to succeed and deliver the expected results, there is a need to:

• Leverage new opportunities to strengthen the demand for good governance that already exist within the citizens of Malawi and support the shift in Malawi's long-standing social contract
• Protect human capital gains especially in health and education, and harness the demographic transition
• Support the shift towards commercial agriculture and creating opportunities for youth employment where only 18% of Malawi's 4.2 million smallholders belong to a functional farming organization
• Think spatially to target vulnerability hotspots and rural-urban integration including areas that are most heavily affected by environmental degradation that is currently being driven by population growth and climate change impacts

Results

Among many other results, the CPF intends to achieve the following:

• Develop a framework in place for effective prioritization, analysis, and oversight of public investment projects
• Develop a framework for cash management and commitment control in place, including explicit provisions for Ministry of Finance to have the ability to ration resources in the evet that budgeted inflows fall below projections, within a set of objective principles
• Publish a Comprehensive Citizens Budget each year
• Support the operationalization of the Access to Information Act
• Improve citizen engagement on Local Authority Annual Investment Plans
• Increase digital payment transactions among adults from 27% to 50%
• Increase Productive Alliances from 37 to 200 under the Malawi Agricultural Commercialization (AGCOM)
• Connect 1,000 small and medium enterprises to the grid
• Install 200,000 off-grid solar systems
• Insure 50% of beneficiaries receive cash transfers via e-transfers

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