The Local Development Fund (LDF) was established by the Malawi Government at the Ministry of Finance as an Inter-Governmental Fiscal Transfer mechanism through which Local Authorities can access financial resources for their local development. The LDF was established in accordance with the Public Finance Management Act 2003, in order to facilitate and respond to local development initiatives at Local Authority and Community levels.
The purpose of the LDF was to establish a nation-wide, sustainable, standardized and transparent financing mechanism, open for financing from the Government and Cooperating Partners (CPs), through which Local Authorities (LAs) could tap into funds for local public infrastructure projects, identified in a participatory process and prioritized in the respective Urban Development Plans. The funding was disbursed through four financing windows, namely the Community, Local Authority, Urban and Performance Windows.
Main activities were:
Construction of local public infrastructure (a.o. housing, markets, bus depots, sports stadiums, business complexes, roads) and ensuring the sustainable operation of the latter; and
Strengthening of the capacities of the LAs to plan, implement and operate the public infrastructure.