Last year's revelations of corruption forced the country's key donors to withhold millions of dollars in budget support and to demand that President Joyce Banda's administration investigate and prosecute those involved in stealing state funds estimated at a whooping US$20 million (MK8.9 billion).
"We meet as CABs on March 11 this year and we will announce whether or not to resume budget support to Malawi...but every country in the grouping will have to make an autonomous decision on this," EU Ambassador, Alexander Baum said in an interview.
Foreign aid to the southern African nation has traditionally accounted for about 40 percent of the national budget.
Baum said that the decision would be based on progress the government of Malawi has made in investigating and prosecuting those involved in the scandal, known locally as "cash-gate".
The IMF a couple of weeks ago rated the southern African nation's economic performance "broadly satisfactory" after completing its third and fourth reviews under a credit facility, enabling the IMF to disburse around $20 million.
This was good news to President Joyce Banda who desperately wants to unlock funds in a tough election year. Many other diplomats in the capital Lilongwe told Malawi Tribune that the IMF's approval has boosted their confidence in doing business with Malawi.
In a statement last week, IMF Deputy Managing Director Naoyuki Shinohara described Malawi's macroeconomic performance under the IMF-supported programme as "broadly satisfactory."
"To restore confidence in the authorities' management of the economy, it will be important for the government to investigate the fraud thoroughly and to implement the action plan to address the weaknesses in public financial management exposed by the fraud," he said.
Banda, who took office in April 2012, implemented austerity measures that led to a restoration of a $79 million IMF aid programme suspended due to a conflict with her predecessor Bingu wa Mutharika.
Banda, who faces an election this year, said she had called for a forensic audit backdated to 2005 that would help reveal the extent of corruption in the aid-dependent, impoverished country.
"This is my commitment to fighting corruption," she said. "So far over 81 people have been arrested and 35 bank accounts frozen," she said in an earlier interview with international media