The International Monetary Fund (IMF) says that Malawi cannot take on any more foreign debt, as it has reached unsustainable levels of over-indebtedness.

The country has a public debt of 6.38 trillion kwachas, more than double this year's budget, which has limited fiscal space.

The country's fiscal authorities have therefore been warned to be more prudent, as Malawi's public debt has become dangerous for the country's macroeconomic environment.

The managing director of the International Monetary Fund, Christalina Georgevia, explained that Malawi can only receive donations from the World Bank and bilateral donors, as the country is in a critical situation and cannot take on any more debt.

Meanwhile, Malawi and an IMF mission have returned to the negotiating table for the possibility of having a Rapid Credit Facility program to prevent the collapse of the country's economy.

According to Radio Mozambique, one of the IMF's demands is that Malawi present a debt management plan.

The World Bank, in its biannual publication that analyzes issues shaping Africa's economic future, reports that Malawi's growing public debt will remain high at around 58.6% of Gross Domestic Product.

The World Bank also notes that although most countries with fewer resources, such as Malawi, have recovered from the 2020 crisis, the worsening of the debt is also due to a strong contribution from private creditors, since Malawi no longer depends on multilateral partners for access to international financial markets for debt financing.

One of the factors leading the Malawi government into over-indebtedness is the affordable inputs program, in which the executive buys fertilizer at high costs and resells it to producers at subsidized prices.

President Lazarus Chakwera asked Malawians not to lose hope for a better future.