Government cautioned on debt
Centre for Social Concern (CfSC) has asked the government to walk the talk in managing public debt, stressing that current levels are a burden on poor Malawians.
CfSC Executive Director Father James Ngahy told journalists in Lilongwe that the country’s indebtedness is an impediment to development.
Ngahy said, with the country borrowing excessively, the scope of expenditure for desirable areas due to servicing of debt is diminishing while private sector investment is also being affected
“CfSC wants the government to walk the talk by implementing austerity measures and improving on political will.
“We believe that austerity measures should apply to all people in government and must not leave out those in authority, including the President. We have to live within our means. These measures should apply uniformly; they must not be selective or hypocritical,” he said.
The institution also pointed out that lack of transparency and accountability as well as continued corruption has cost citizens, citing the increase in cases of cholera due to lack of safe water despite the country borrowing money for implementation of water projects.
Ngahy cited Zomba, saying the government acquired a loan for rehabilitation of Chingale water scheme while in Phalombe the government acquired a loan from African Development Bank to rehabilitate Phalombe major scheme but the communities are yet to access potable water.
But Minister of Finance Sosten Gwengwe said the country’s tax base is too narrow to fund the budget, hence the recourse to borrowing.
“Resource envelop is too little for a population of 20 million people. They can suggest ways on how government can collect enough to fund its budget. Most expenditures are statutory and you don’t apply austerity measures on people’s salaries” Gwengwe said.
As of September 2022, public debt had grown to K7.3 trillion.