Presidential adviser on economic affairs Collins Magalasi has revealed that officials at Capital Hill are working day and night to review the budget and meet commitments with the International Monetary Fund (IMF) whose mission returns in the country next month for a crucial review of its programme with Malawi.
Magalasi said the government is working on revising downwards the national budget to meet the IMF requirements following the fund’s September 2015 declaration of the Extended Credit Facility (ECF) programme for Malawi as being off track.
He said the government is working on addressing domestic net borrowing and cutting of the budget which, he said, are the key requirements for the country to get back on track on the programme with the IMF.
“Once we have revised the budget downwards, which is almost complete right now, we are sure that we will get back to the commitments that we made with the IMF,” he said.
Apart from meeting IMF targets, Magalasi said the government is also working hard to make sure that the economy stabilises.
He said although he could not state when the economy could stabilise, it was the focus of government to avoid putting the country in a much worse situation than it is.
“We are coming from a very deep end but I believe that we have reached the worst point. We cannot get worse than this and looking at policies and practices that the government has put in place, we can only hope that things will get better,” said Magalasi. Despite optimism by the IMF and the government that Malawi will get back on track on the programme by December, some local economic commentators have, however, expressed doubt at the projection, saying prospects still look groomy.
Chancellor College economics professor Ben Kalua and former Economics Association of Malawi (Ecama) Executive Director Nelson Mkandawire, told The Daily Times of Tuesday that they don’t see the economy recovering any time soon.
Kalua said the economy is still passing through turbulent times and remains susceptible to more shocks while Mkandawire said the IMF targets may only be attainable if more effort is put in place to address factors triggering the runaway inflation.