ICAM wants cut in lending rate
The Institute of Chartered Accountants in Malawi (ICAM) has called on government to create an environment that would enable a drop of interest rates to 22 percent.
ICAM’s member of audit and taxation, Audrey Mwala, made the call last Thursday during the 2016/17 pre-budget consultation meeting hosted by Finance Minister Goodall Gondwe.
According to Mwala, the high interest rates, now hovering around 40 percent, have increased the cost of production by the private sector.
She said increased government borrowing through Treasury Bills (TBs) is also crowding out the private sector from borrowing as the TBs rates are more attractive.
“ICAM is requesting government to take a deliberate bold action of immediately cutting down the interest rates to possibly around 22 percent,” suggested Mwala.
Also commenting on public finance management, Mwala said despite recorded progress in covering existing loopholes, there is still a lot that needs to be done.
She called on government to put more efforts on controlling public expenditure and public debt.
“There is an urgent need to clear the backlog in government financial reporting, and thereafter, to ensure timely financial reporting,” she said.
She said this will ensure that leakages are closed so that available resources efficiently utilised.
Reacting to the calls, Finance Minister Goodall Gondwe said strides have been put to place in ensuring an effective environment for doing business and sustainable economic growth.