The African Development Bank (AfDB) has approved a $20.5 million package for Malawi, equivalent to approximately K34 billion, in direct budgetary support.

Finance Minister Joseph Mwanamvekha announced the development on Tuesday night.

Speaking on the sidelines of the eighth Korea-Africa Economic Cooperation (KOAFEC) Ministerial Conference in Seoul, Mwanamvekha said AfDB Director General and Acting Vice-President for Africa Abdou Kamara had informed him that the bank’s Board approved the funding on September 1, 2026.

Malawi submitted its request for the funding in May this year.

“As government, we are happy with this support, which will help us strengthen our foreign exchange reserves. We will use the money to purchase fuel and fertiliser ahead of the farming season,” said Mwanamvekha.

Mwanamvekha added that the funding was a sign of trust from the donor and development partner community in the administration of President Peter Mutharika.

“More donors and partners have also given us hope, and we expect more grants and direct budgetary support because they have all given us hope,” said Mwanamvekha.

On Wednesday, September 9, 2026, Mwanamvekha is scheduled to meet AfDB President Sidi Ould Tah, where, among other things, he is expected to push for additional budget support under the AfDB’s global energy and fertiliser crisis response framework.

However, University of Malawi-based economist Edward Lemani said the development was a positive signal but cautioned against interpreting it as evidence of strong donor confidence.

“Generally, it is a good signal—the green light to say that donors are coming back to support the budget, something that we have been looking for for a while. The fact that donors are coming back to provide direct budgetary support is a good thing. There has been movement from the government, and this should, as a result, be good for donors to come in and provide direct budget support. But to say that there is strong donor confidence, I think it would be premature,” said Lemani.

The government is implementing a K10.978 trillion expenditure plan, which has already received direct budgetary support from the European Union.