Economic Affairs Division

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Background
The Economic Affairs Department (EAD) is the Government’s think tank responsible for policy analysis on a wide range of issues including: fiscal and monetary policies, financial sector reforms, public enterprise management and economic integration. It coordinates the preparation and monitoring of national budget, the monitoring and analysis of macroeconomic performance especially relating to fiscal and monetary policies, the regulation of financial institutions and the coordination of development of regional economic policies.
It is responsible for ensuring that policy advice is targeted at achieving the strategic objectives as spelled out in the Malawi Growth and Development Strategy (MGDS) namely creating wealth through sustainable economic growth and infrastructure development as means of achieving poverty reduction. The main purpose of the Department is to provide short to medium – term economic, fiscal and monetary policy services to the Minister of Finance and the Secretary to the Treasury (ST) in collaboration and consultation with relevant institutions and partners.

The Department has the following five sections:


Core Functions

1. MACROECONOMIC POLICY SECTION (MPS)

Preamble
The macroeconomic section is crucial for dealing with macroeconomic issues including fiscal policy which is the Ministry’s core function. The Unit is the fiscal policy information point, in that it is the source of macroeconomic data and analyses as they relate to fiscal policy and all interrelated policy arms. The Unit also coordinates all macroeconomic programmes in collaboration with all relevant institutions.

Mandate
The mandate is derived from the Public Finance Management Act (PFMA) of 2003 and Treasury Instructions of 2004.

Purpose
The purpose of the section is to provide first-hand sound macroeconomic advice to the Minister of Finance and the Secretary to the Treasury on macroeconomic developments and aggregates such as GDP, inflation, interest rates and general fiscal policy in consultation with Ministry of Development Planning and Cooperation (MDPC), Reserve Bank of Malawi (RBM), and National Statistics Office (NSO).

Core Functions

2. SECTORAL POLICY ANALYSIS (SPAS)

Preamble
The Ministry of Finance encounters public finance policy and management issues and challenges in its day to day work, emanating from both internal policy deliberations and sectoral developments. In order to solve some of these issues and challenges there is a need for an in-house facility to conduct or supervise studies that will contribute to reforms in public finance policy, planning, legislation and the institutional framework. The Unit will also provide a public finance perspective of implications arising out sectoral developments and plans.

Mandate
The mandate of this Unit can be traced to the 2004 Ministry of Finance(MoF) Functional Review . The need for this facility has from time been subsequently followed up in various MoF Management and internal Economic Affairs Department meetings with the ultimate aim of formalizing and institutionalizing the public finance related policy studies function in MoF. Even at the national level there is discussion to create a public policy research institution similar to others in the region.( This Section within the Ministry can in a way be seen as link to the envisaged research facility in the future).

Purpose
To conduct studies that will improve the public finance service delivery through policy and planning.

Core Functions

3. PUBLIC ENTERPRISES REFORM AND MONITORING UNIT (PERMU)
This section is not new, it been there as an independent Unit in the ministry of finance. Its main function is supervising all public enterprises and ensuring that these parastatal institutions are performing to meet government’s expectations.

Duties:

4. FINANCIAL SECTOR UNIT

Preamble Being a relatively new Unit, reflecting some of the dynamic roles that the Ministry is assuming lately, this Unit is there to facilitate increased access to financial services in order to spur rapid economic growth and development. The Section will focus on coordinating three main areas of financial sector reforms including policy and regulatory framework, innovation and capacity development. Financial sector reforms will cover banking, insurance, microfinance, capital markets, pension funds and asset management, debt market, financial intermediaries, payment systems, credit reference systems, foreign exchange markets and money transfer systems.

Mandate

The mandate creating this unit stems from an agreement between the Government of Malawi and the UNDP/UNCDF in June, 2007 aimed at contributing to MGDS/MDGs goals of reducing poverty specifically by increasing access to financial services to the population and in particular the poor.

Purpose
To create a vibrant and inclusive financial sector through necessary financial reforms

Core Functions

5. RESEARCH, PLANNING, MONITORING AND EVALUATION SECTION (RPMES)

Preamble
The Ministry of Finance encounters public finance policy and management issues and challenges in its day to day work, emanating from both internal policy deliberations and sectoral developments. In order to solve some of these issues and challenges there is a need for an in-house facility to conduct or supervise studies that will contribute to reforms in public finance policy, planning, legislation and the institutional framework. The Unit will also provide a public finance perspective of implications arising out sectoral developments and plans.

Mandate
The mandate of this Unit can be traced to the 2004 Ministry of Finance(MoF) Functional Review . The need for this facility has from time been subsequently followed up in various MoF Management and internal Economic Affairs Department meetings with the ultimate aim of formalizing and institutionalizing the public finance related policy studies function in MoF. Even at the national level there is discussion to create a public policy research institution similar to others in the region.( This Section within the Ministry can in a way be seen as link to the envisaged research facility in the future).

Purpose
To conduct studies that will improve the public finance service delivery through policy and planning.

Core Functions