Malawi borrows US$10 million from Arab Bank: Parliament approves
Malawi Parliament on Monday authorised government to borrow US$10 million (almost K3 billion) from the Arab Bank for Economic Development in Africa (Badea) to fund some of its projects in the Green Belt Initiative.
The loan authorisation Bill which appeared as number 28 of 2012 was the first to be passed after the House resumed its new meeting which is scheduled to last for three weeks.
According to Leader of the House there are a total of 24 Bills to be brought into the House during the period.
Presenting the Bill Minister of Finance Ken Lipenga said the money is aimed at funding the second phase of the Small, Farms Irrigation Project along Lake Malawi and will benefit two districts Nkhatabay and Mangochi targeting more than 4,000 households in these districts.
“The goal in the whole project is to put about one million hectares of land under irrigation with the aim of improving agricultural production, promoting food security and improve nutrition, and also creating employment,” said Lipenga.
During contribution towards the Bill one of the MPs MCP’s Vitus Dzoole-Mwale asked Minister of Finance to bring figures of how much the country has borrowed so far expressing concerns that borrowing without checks and balances may lead the country into another debt that would be problematic to coming generations.
“I think we are borrowing too much,” said Dzoole-Mwale.
He also expressed concerns that for a long time government has been borrowing money but without tangible results to the intended beneficiaries because the money is at times diverted to other uses.
“Our farmers are still using hoes. These hoes at times can break people’s backs, we want to see our farmers transforming to mechanised farming using tractors,” said Dzoole-Mwale an MP for Lilongwe Msozi south.
Lipenga said the borrowed amount is expected to be repaid in a period of 30 years with a 10 year grace period at an interest rate of one percent annually.
