Minister of Finance, Economic Planning and Development Goodall Gondwe has said Malawi needs effective domestic resource mobilization to develop successfully.
Gondwe said this in Lilongwe during the high level forum on development effectiveness which was held under the theme ‘Towards a transformed and self-reliant Malawi’ and attracted participants from the academia, cabinet ministers, Civil Society Organisations, development partners, among others.
The finance minister said the African Union (AU) has adopted a broad view of domestic resources that is not only looking at tax revenues, but also pension fund assets, mineral earnings, international reserves, Diaspora remittance, stock market capitalization and private equity.
Gondwe said: “It is only proper, therefore, that African countries such as Malawi should now start developing policies and legal instruments that are aimed at creating a favorable environment that would ensure efficient and effective mobilization of these resources for development effectiveness.”
According to Gondwe, there is no doubt that Malawi has adequate domestic resources with potential to finance its development programmes and become a middle income country just like Botswana and Kenya.
He therefore took time to explain some of the challenges in domestic resource mobilization in Malawi which according to him include having a narrow tax base, having an under-developed stock market among others.
“Domestic resource mobilization in Malawi has the following challenges and these include; having a narrow tax base, an under-developed stock market, limited pension fund assets, low Diaspora remittances as well as high levels of unemployment,” he said.
Head of Department for International Development (DfID) in Malawi , Jen Marshall commended Malawi for making strides since she attained her independence and for carrying out reforms in the public sector.