Malawian President Peter Mutharika has said his government is ready to run its financial plans without the budgetary support from donors in the next five years.
Mutharika said government is determined to continue with zero-aid budget owing to current uncertainties around donor funding, confidently saying Malawi will in five years be able to run its recurrent budget without donor support.
The Malawi leader made the remarks when he held a news conference at Kamuzu Palace in Lilongwe during on some of the benefits the country gained by attending the Common Markets for Eastern and Southern Africa(COMESA) held in Addis Ababa Ethiopia.
“There was a lot that we learnt as a country at the 18 COMESA Summit and among the various lessons was how African countries, Malawi in particular could reduce dependency on donor support especially in regards to the recurrent budget,” said Mutharika.
Mutharika said the recurrent expenditure will be financed entirely from Malawi resources admiring Ethiopia that it managed to migrate from donor dependency through small and medium economic activities and also by encouraging its people to embrace the idea of saving money while reducing expenditures.
“During the discussion with the Ethiopian Prime Minister, I leant that through cooperatives and community saving activities it would be possible for the country to run its recurrent budgets without donor support.
“I am confident that should we become serious, in the next five years we will be able to run our recurrent budget without the help of the donors,” Mutharika explained.
Apart from cooperatives and financial savings, the President said the country could also improve its economic base by scaling up industrial activities with a specific focus on production.
When government says the recurrent expenditure will be financed with domestic resources, it means that money for wages and salaries, goods and services, interest on debt, subsidies and transfers and other statutory expenditure will be sourced locally.
Malawi adopted a “zero-aid budget” for 2014/15, after donors suspended general budget support to government following unprecedented corruption scandal, known as “Cashgate”.
But Malawi cannot balance its books without donor support, which makes up as much as 40% of the national budget.
President Mutharika appealed to Malawians to join hands and support government in its quest to improve the economy of the country.
Malawi is implementing swingeing budget cuts in a desperate attempt to win back donors’ faith.Follow and Subscribe Nyasa TV :