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World Bank Approves $86M to Improve Access to Financial Services for MSMEs in Malawi

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The World Bank Board of Executive Directors recently approved an $86 million credit for the Malawi government to increase access to financial services and promote the entrepreneurship and capabilities of micro, small, and medium enterprises (MSMEs) in Malawi, including addressing the negative economic effects of COVID-19 (coronavirus). 

The COVID-19 pandemic has created economic shockwaves transmitted through falling demand, reduced and disrupted input supply, tightening of credit conditions and liquidity crunch, and rising uncertainty. These developments are amplifying the challenges faced by MSMEs, including lack of access to finance, and damaging otherwise healthy firms. The Government of Malawi is, therefore, seeking to support MSMEs in the short- and medium-term to weather the impacts of the pandemic, and in the medium- and longer-term, to boost job creation and sustainable inclusive growth.

“This project is an important element of the World Bank Group’s response to COVID-19 in Malawi, from relief, through re-structuring, towards ensuring a resilient recovery. This project contributes to relief efforts, with a clear focus on helping communities and businesses persist and find new opportunities. It provides flexible support in line with the government’s contingency plan, along with other key development partners, by contributing to select elements of business growth in the private sector and enhancing financial inclusion and job creation,” said Hugh Riddell, Word Bank Country Manager for Malawi. 

The project will make financial resources available through a credit line to ensure MSMEs continuously supply essential goods and services to the economy and to mitigate the risk of failure/bankruptcy. In addition, the project will facilitate opportunities for MSMEs that have potential for high growth to thrive and grow over the medium-to-long term by providing training, particularly for youth- and women-owned businesses, followed by measures to connect trainees with market opportunities. Finally, the project is also expected to address some of the market failures that limit the supply of affordable finance and develop solutions for a more conducive business environment for dynamic business creation, including building capacity of institutions and business development thereby sustaining the lending and investment.

“The majority of MSMEs in Malawi are informal, and access to finance remains a key constraint, coupled with low capacity and inadequate innovation.  Despite this situation, innovative start-ups and MSMEs with high-growth potential can create jobs and, hence, are an important area of focus for governments,” said Niraj Verma, World Bank Finance Competitiveness and Innovation Practice Manager.

* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 76 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change to the 1.6 billion people who live in IDA countries. Since 1960, IDA has supported development work in 113 countries. Annual commitments have averaged about $21 billion over the last three years, with about 61 percent going to Africa.

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Africa Today

Sudan: 250 killed, over 100,000 displaced as violence surges in Darfur

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Intercommunal violence in Darfur has left millions in need of assistance. Pictured here, an IDP settlement in Sortoni. (file photo) UNAMID/Mohamad Almahady

A sharp uptick in intercommunal violence in Sudan’s Darfur region has forced more than 100,000 people to flee their homes in search of safety, including many into neighbouring Chad, the UN refugee agency (UNHCR) reported on Friday.

According to the agency, 250 people – including three humanitarian workers – also lost their lives in the clashes that started on 15 January in West Darfur province, and spread into South Darfur the next day. 

Boris Cheshirkov, a UNHCR spokesperson, told journalists at a regular press briefing in Geneva on Friday, that about 3,500 new Sudanese refugees have arrived in eastern Chad. 

“These refugees – the majority of them women and children – have been hosted in four very remote locations that lack basic services or public infrastructure, where they have been sheltering under trees,” he said. 

“Due to the COVID-19 situation, Chadian local authorities are directing the new arrivals to a transit site, where they will undergo quarantine before being relocated to an existing refugee camp, away from the border,” the UNHCR spokesperson added. 

He said that the UN agency is rushing supplies to the area to respond to their needs, as well as mobilizing resources as part of an inter-agency response. 

‘Break the cycle of violence’ 

Authorities in the region have been attempting to contain the situation and have deployed security forces to the area but “severe gaps” in protection remain, according to the UN human rights office. 

However, an “imminent risk” of further violence remains, in an environment “where decades-old ethnic and tribal tensions that were further stoked by the previous regime continue to fester”, OHCHR spokesperson Ravina Shamdasani said at the same briefing. 

There are reports that local health facilities are unable to cope with the high number of casualties, she added. 

The OHCHR spokesperson called on the Government of Sudan to protect of civilians as well as restore public order and the rule of law in Darfur. 

She also called for thorough and effective investigations into the violence to bring the perpetrators to justice and “to break the cycle of armed citizens taking the law into their own hands to avenge attacks on members of their communities.” 

A vast, strife-torn region  

Darfur, a vast region roughly the size of Spain and plagued by violence for years, was the site of a United Nations-African Union hybrid peacekeeping mission (UNAMID) that was deployed to protect civilians, facilitate aid delivery, and support efforts to address root causes of the conflict.  

The mandate of UNAMID ended last year and it ceased operations on 31 December 2020, roughly two weeks before the latest round of violence.  

The mission is currently drawing down, a process that includes repatriation of troops, their vehicles and other equipment; the separation of civilian staff; and the closure of its offices.  

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COVID ‘vaccine hoarding’ putting Africa at risk

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Photo: Xinhua

Africa is in danger of being left behind in the rollout of COVID-19 vaccines as countries in other regions strike bilateral deals, thus driving up prices, the World Health Organization (WHO) warned on Thursday. 

Although vaccines have been administered in 50 wealthier nations, Guinea is the sole low-income country on the continent to receive doses, with only 25 people being inoculated so far.  Meanwhile, Seychelles is the only African country to start a national vaccination campaign. 

‘We first, not me first’ 

“We first, not me first, is the only way to end the pandemic. Vaccine hoarding will only prolong the ordeal and delay Africa’s recovery. It is deeply unjust that the most vulnerable Africans are forced to wait for vaccines while lower-risk groups in rich countries are made safe”, said Dr Matshidiso Moeti, WHO Regional Director for Africa. 

“Health workers and vulnerable people in Africa need urgent access to safe and effective COVID-19 vaccines.” 

An international coalition known as the COVAX Facility was established to ensure all countries will have equal access to any vaccines against the new coronavirus disease. 

It is co-led by the Coalition for Epidemic Preparedness Innovations (CEPI), Gavi, the Vaccine Alliance, and WHO. 

The COVAX Facility has secured two billion doses of vaccine from five producers, with options for over one billion more.  Delivery is set to begin soon, according to Thabani Maphosa, Managing Director, Country Programmes at GAVI. 

“This massive international undertaking has been made possible thanks to donations, work towards dose-sharing deals and deals with manufacturers that have brought us to almost two billion doses secured. We look forward to rollout in the coming weeks”, he said. 

Vaccination commitment  

COVAX has committed to vaccinating at least 20 per cent of the population in Africa by the end of this year. 

Priority will be given to health workers and other vulnerable groups, such as older persons and those with pre-existing health conditions. 

An initial 30 million vaccine doses are expected to begin arriving in countries by March.  Overall, a maximum of 600 million doses will be disbursed, based on two doses per person. 

WHO said timelines and quantities could change, for example if vaccines fail to meet regulatory approval or due to challenges related to production, delivery and funding.

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‘Complex’ emergency unfolding in Mozambique’s Cabo Delgado

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A group of people, having fled violence in several districts of Cabo Delgado, arrive in the provincial capital, Pebma. IOM/Matteo Theubet

UN agencies voiced deep concern on Wednesday over the worsening humanitarian crisis in Mozambique’s Cabo Delgado province, where attacks by armed groups have forced more than 565,000 to flee their homes. 

According to the agencies, growing insecurity and poor infrastructure are making it increasingly difficulty to reach families “completely reliant” on humanitarian assistance, amid fears that imminent rains and threat of cyclones could further compound the challenges. 

“Coupled with the fallout of the COVID-19 pandemic, the crisis has become even more complex”, regional heads of UN agencies in east and southern Africa said in a joint statement

“The crisis is a complex security, human rights, humanitarian and development emergency, underscoring the imperative of continuing to provide life-saving assistance while collectively supporting Government-led long-term resilience building”, the statement added. 

Crisis worsening 

In December, the UN officials visited Mozambique to assess the needs of the displaced populations as well as of the host communities.  

They heard extremely moving accounts from displaced men, women and children in the city of Pemba, the capital of Cabo Delgado, and in the districts of Ancuabe and Chiúre – people whose lives have been upended by conflict and insecurity. 

While acknowledging that much has been done to help victims of the crisis, the UN officials stressed that with displacement increasing daily, the lack of adequate food, water, sanitation, shelter, health, protection and education, was exacerbating an already dire situation, which could be further complicated by on-going torrential rains.  

Urgent support needed 

The UN agencies also raised concerns over the continuing impact of the coronavirus pandemic, which is keeping most schools closed. 

There is an urgent need to expand protection, healthcare, food and nutrition programmes, vaccination efforts and psychosocial counselling, and to aid displaced farming and fishing families to re-establish sustainable livelihoods, they added. 

They also urged support for adequate resettlement of uprooted families straining the already limited resources of impoverished host communities, and Government efforts to effectively register and assist the displaced. 

The senior officials are urging the Government of Mozambique and the international community “to step up efforts to end all forms of violence in the country, including gender-based violence and child marriage, and to invest more in women and girls as agents of progress and change,” the statement said.

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