The World Bank says it will support government initiatives that will improve domestic tax collection, an initiative aimed at increasing tax-to-gross domestic product (GDP) ratio for sustainable economic growth and debt management.

World Bank country manager Greg Toulmin outlined that increasing the tax-to-GDP ratio in Malawi is crucial in creating fiscal space to finance priority spending while avoiding unmanageable debts. His response comes after Oxfam  recommended that the World Bank’s International Development Association (IDA19) funding should support domestic resource mobilisation (DRM) programs that increase quantity tax to GDP and quality, equitable composition of revenue mobilisation simultaneously. Agreeing with Oxfam, Toulmin said that Malawi currently has a fairly high tax-to-GDP ratio compared to other countries at similar levels of development.

Last month the World Bank expressed doubt over Malawi’s economy, decrying the current corruption and fiscal indiscipline, calling on the government to act on the problematic economic environment. This follows reports of the International Monetary warned Malawi on overborrowing.

The bank also punched holes in the 2018/19 budget, saying that it will not meet its target due to effects of Cyclone Idai. Through a report known as Malawi Economic Monitor (MEM) the doubts were made known, as World Bank Malawi Country Manager Greg Toulmin cited weak governance and corruption as areas of concern of World Bank.