As global aid flows tighten, Malawi faces a defining moment.

Official Development Assistance (ODA) cuts are difficult, but they also highlight the need to use every dollar more strategically—leveraging external support to complement domestic financing and strengthen long-term sustainability.

Domestic financing dominates—but mostly for salaries

Malawi funds most of its education sector through domestic resources. The challenge?

Nearly all of it goes to salaries and recurrent costs. In FY2025, only 7% of the government’s education budget was available for development needs to improve quality of learning outcomes such as teacher training, teaching and learning materials and classroom construction.

This 7% cannot stretch far—especially amid slow economic growth, rising debt repayments, and fiscal inefficiencies. Efforts like increasing the Constituency Development Fund, with 20% earmarked for education, are promising but still far from sufficient.

Efficiency matters as much as more money

Better financing isn’t only about more funding—it’s about smarter funding.

The World Bank’s Governance to Enable Service Delivery program shows that predictable financing and stronger local accountability improve results.

Complementing this, the GPE–World Bank disbursement linked indicator on district education funding (Other Recurrent Transactions) is helping ensure that resources are allocated more equitably and used efficiently, ultimately driving better learning outcomes across Malawi.

These bottlenecks continue to undermine learning outcomes, making system-level reforms essential for real progress.

Why education must stay at the center

Education is not just a social service—it’s an economic engine. Malawi’s Vision 2063 places human capital at the core of an “Inclusively Wealthy and Self-reliant Nation”. Foundational literacy and numeracy skills fuel productivity, innovation, and long-term growth.

ODA still matters—but it must be used strategically

Even as global aid reduces, strategic use of ODA—especially grants—remains essential for Malawi. Its value lies in protecting key education spending and strengthening core systems.

What matters is not only how much aid is given, but how wisely it is used. High quality ODA:

• Works through national systems
• Unlocks additional financing
• Supports reforms governments can sustain long term.

When aid shifts from plugging short-term gaps to reinforcing long-term financing, it becomes catalytic—helping build a resilient, sustainable, future-ready education system that tackles inefficiencies at their roots.

Malawi is already demonstrating how this can work:

1. Teaching at the Right Level (TaRL): Evidence driven, system aligned

The TaRL informed remediation approach—funded by the Foreign, Commonwealth and Development Office (FCDO) and grounded in a globally proven, research-backed model—has demonstrated significant learning gains in many countries.

In Malawi, the pilot offers early promise, with the potential to improve basic skills if fully adopted and sustained. Because the model relies on existing teachers and uses government systems, it is designed to be cost effective and scalable.

The government has signaled its commitment by planning to integrate remediation reform into the GPE/World Bank–supported Malawi Foundational Learning Program, creating a pathway to scale once the pilot’s lessons are fully built into the system.

2. Continuous professional development: Building teacher skills for the long term

Supported by GPE and the World Bank, Malawi’s continuous professional development reform is redesigning how teachers are trained—using government structures and expertise.

A performance linked disbursement trigger on equitable teacher deployment further strengthens long-term teacher management.

3. Philanthropic financing: Catalyzing sustainable reform

Targeted philanthropic investment is also helping Malawi test and grow contextualized, evidence-based approaches that the government can eventually sustain.

Following initial FCDO support—and promising learning gains shown through a co-funded randomized controlled trial—the Prevail Fund has committed to continue supporting the National Maths Curriculum Reform, Malawi’s structured pedagogy math initiative backed by global research.

Crucially, the Prevail Fund is working with government on an embedded research and transition plan, creating a pathway for the reform to gradually shift to full domestic financing over time.

4. Classroom construction: Community led efficiency

Classroom shortages absorb much of Malawi’s development budget. But lessons from the community led, cost effective construction model under the GPE/World Bank program show that quality classrooms can be delivered at lower cost—expanding access within limited resources.

5. Leveraging the GPE Multiplier: Unlocking more financing

Globally, the GPE Multiplier offers a powerful mechanism to mobilize bilateral, multilateral, philanthropic, and private financing behind national priorities.

Every GPE dollar can unlock at least four more, with a 1:1 matching window for the private sector and foundations—making it ideal for accelerating reforms underway in Malawi.

This innovative financing instrument has already mobilized additional funds of US$21 million for the Malawi Foundational Learning Program and $15 million for Malawi’s Building Education Foundations through Innovation and Technology program.