Joyce Banda
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Malawi's new president Banda cuts costs

3 June 2012 Last updated at 01:50 BST

Malawi's new president, Joyce Banda, is scrapping her luxury presidential jet as part of a series of cost-cutting measures to help the poverty-stricken country.

Political turmoil, a suspension of foreign aid and an abrupt currency devaluation left the new government with a substantial hole in its budget. The UK had called for urgent action to prevent a Greece-style financial crisis in the country.

Britain's International Development secretary, Andrew Mitchell, welcomed the move and released a tranche of suspended aid.

Peter Wilson reports.