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Why aid money has returned to Malawi

Aid donors, such as the US Millennium Challenge Corporation, have reinstated aid projects that had been suspended because of authoritarian policies of Malawi's previous leader.

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Under the mercurial President Bingu wa Mutharika, Malawi was a country that seemed eager to pick fights with aid donors, the richer countries that supplied up to 40 percent of Malawi’s budget.

In the year before his death, President Mutharika announced that he would defy the International Monetary Fund and continue to provide subsidized seed and fertilizer to Malawian farmers. In parliament, he warned human rights activists that they could face jail time if they insulted him. And on the streets of Lilongwe, he followed through: As protesters called for Mutharika’s removal, Malawian police responded with gunfire, killing 20. It was then that Malawi’s donors cut the country off from international aid.

Today, under President Joyce Banda, Malawi is winning donors back. She has announced legislation that would give full rights of expression to journalists and activists. She sold the $12.9 million presidential jet and fleet of limousines. And donors have responded by starting up aid dollars again.

The most recent win for Malawi is America’s Millennium Challenge Corporation, an independent US foreign aid agency that gives aid to poor countries that make improvements in democratic governance, human rights, and economic reform.

Daniel Yohannes, the chief executive officer of MCC, met President Banda on Thursday, and announced that his organization would reinstate $350 million in grants for hydropower projects in Malawi.


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