Opposition, donors react to budget


Opposition political parties have described the 2016/17 s challenging to Malawians as it is asking a lot from them.

Main opposition political parties, Malawi Congress Party (MCP) and People’s Party (PP) expressed dissatisfaction with the issues raised in the budget.

MCP spokesperson on Finance, Alexander Kusamba Dzonzi said the budget is mainly aimed at pleasing international lending institutions.


“It is a bold budget because it is asking a lot from Malawians. Whether that is going to happen or not, I don’t know. But the fact is: what the Minister of Finance has presented is an IMF budget because almost all what he has is that there has been an agreement between government and IMF. He could be heard saying ‘According to IMF’. The question MCP is asking is: When is the Minister of Finance going to present a Malawi budget? The budget that is going to reflect the discussion between government and the people of Malawi?” Dzonzi said.

People’s Party (PP) spokesperson on Finance, Ralph Jooma, said it was surprising that government decided to formulate a deficit budget.

“It is a budget that is telling us that total expenditure K1.13 trillion, while total revenue that will be available for this government to spend will be K965 billion. We think that the gap is just too much. What this means is that the government will be printing money to the tune of K70 billion,” he said.


Economics Association of Malawi president Henry Kachaje said the budget will be challenging to Malawians.

“In a nutshell I think it is going to be a very good challenge, for the country to test itself, to see whether we can indeed achieve the high targets that have been set by this budget,” he said.

He however said compared to last year’s budget in dollar terms, increase may not be big.

“What it means obviously is that there is going to be a deficit. But the Minister of Finance said there were already opportunities, line of credits to balance up the budget. The minister also mentioned that there will be some domestic borrowing but it will be cut. But if you convert the budget to US dollars you will see that there hasn’t been a major increase in terms of the value,” Kachaje said.

On the other hand, some of Malawi’s donors have urged government to be serious in the way government implements the 2015/16 budget which finance minister, Goodall Gondwe, unveiled yesterday.

US ambassador Virginia Palmer said government has to make sure that government sticks to the financial plan.

“One thing that has come out in the minister’s statement is the intensification in the fight against corruption. Another issue is the fight against drug theft. Government has outlined public Finance Management Reforms. These are good measures.”

She added: “If government sticks to the budget, it will have a positive impact on interest rate. I will encourage more American companies to come to Malawi.”

International Monetary Fund (IMF) Resident Representative in Malawi, Geoffrey Oestriecher, hailed efforts that are being made to reduce inflation.

He said inflation is one area that needs to be looked at critically as it has a direct impact on the lives of people.

“On the other hand, there is the desire to direct social support, direct funding that will alleviate the condition of the poor. This year I think government has got the priorities straight in that the minister alluded to the fact that food will be the main issue and the priority will be to mobilise enough resources and that is something we will support,” Oestriecher said

British High Commissioner Michael Nevin said stressed the impact reforms in the agriculture sector.

“He was right to say that the budget is with us, can stay with us. Somewhere he talked about Malawi’s agriculture. There is indeed need to change in that sector,” Nevin said.

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