Parliament Approves $50 Million Facility to Boost Resilient Value Chains

Malawi’s Parliament on Wednesday passed the International Development Association Transforming High-Potential Resilient Value Chains Project Bill, 2026, authorizing government to receive $50 Million in grant financing to support growth in targeted export sectors.

Minister of Finance, Economic Planning and Decentralization, Joseph Mwanamvekha, tabled the bill in the August House. The financing agreement was signed with the International Development Association on 19th June 2026 and seeks to increase growth for qualifying firms operating in Malawi’s export value chains by improving access to finance, strengthening policy frameworks, and building resilience to climate and market shocks.

Under the agreement, government will use the funds to support an Export Readiness Program that provides advisory services and performance-based grants to equip firms with the skills and incentives to enhance export capacity. The project will also provide technical assistance to the Ministry of Industrialization, Business, Trade and Tourism to strengthen implementation of the Control of Goods Act, 2018. This includes updating rules and regulations to boost investment and production, developing data and dashboard tools to inform evidence-based export restriction decisions, extending the validity of export licences for qualifying commercial agricultural exporters, and updating trade policy and related strategies.

A central element of the project is the institutionalization of a transparent and rules-based process for export restriction decisions.

This will involve the issuance and public disclosure of a new Ministerial Directive, a first structured review of export restrictions and the publication of an export restriction list, and a second review and updated list within twelve months.

On the financing side, the project will establish a Partial Credit Guarantee Fund to provide guarantees to eligible participating financial institutions lending to firms in export value chains, with technical support to the Malawi Agriculture and Industrial Investment Corporation for operationalization. It will also create a Shock Responsive Mechanism linked to the guarantee fund following a feasibility study to determine de-risking needs for firms exposed to climate risks.

Additional support will come through local currency and foreign exchange lines of credit to help exporters and domestic suppliers access commercial products and import intermediate goods for exports, alongside advisory services to operationalize the mechanisms.

The project further provides for management support to the implementing entity, including strengthening implementation arrangements, recruitment of an independent verification agent, financing of operating costs, and capacity building on technical, environmental and social aspects.

The Act charges any payments required under the Financing Agreement to the Consolidated Fund and mandates that proceeds be applied solely to the project. Implementation will run until 30th April 2031.