3.3 - Malawi

Question 1

How much of gov. budget comes from aid?

Answer 1

71%

Question 2

What was the 2014 cashgate scandal and its impacts?

Answer 2

• $300,000 dollars in boot of account assistant’s car - Minister for Finance was investigating corruption but shot outside his home
• UK + Norway froze bilateral aid ($150million) and IMF delayed $20 million loan payment

Question 3

What downsides to aid does Malawi show?

Answer 3

• Aid encourages dependency - 71% gov budget from aid
• Promotes corruption - cashgate scandal
• Much of money can ‘leak’ away and not reach intended recipients
• Could overwhelmingly benefit ruling class with little trickling down to those in need

Question 4

What are the consequences of cutting bilateral aid to Malawi?

Answer 4

• China making up shortfall reduces UK + Norway’s bargaining power
• Creates geopolitical tensions
• Not helping people at all - definite fall in QoL, education and future of people - risk of great poverty

Question 5

Positives of cutting bilateral aid to Malawai?

Answer 5

• Reduced corruption - improved HR
• Can increase independence in the LR
• Reduces power of gov to abuse - increases incentive for them to comply with regulations to earn back aid