President Lazarus Chakwera has underscored the need for government and the private sector to jointly focus on structural challenges that act as barriers to business competitiveness to achieve a domestic and export-oriented industry.
Chakwera made the remarks on Saturday at Sanjika Palace during an interface meeting with representatives from the private sector.
“Electricity, water and transportation costs among others come to mind whenever I think of doing business and I believe that our priority should be to deal with these barriers once and for all,” said Chakwera.
Chakwera said some of the propositions that business captains make like protective taxation regime and exchange policy can only assist in short-term as they do not help businesses build the necessary competitiveness.
“I have had the opportunity to meet with a number of companies who seem to have common complaints, the most prominent being scramble for the small sized domestic market.
“Most of your businesses have been asking for a taxation regime that is protective in nature. While that may assist in the short-term; it does not help you build the necessary competitiveness that should enable you to withstand competition from imports and later to start exporting,” he said.
Chakwera added that he is aware that exporters also harbour their concerns especially relating to the exchange rate policy.
“Naturally exporters would like the currency to be devalued to align it with those of other countries exporting similar goods. However, such policy actions may be useful in the short-term but may not sustain those businesses in the long-term,” said Chakwera.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI) President, James Chimwaza said the meeting with the President Chakwera brought to light some of the challenges that the private sector has encountered over the years with possible suggestions of solutions to each one of them.
“The issues revolved around levelling the playing field, smuggling and challenges like those brought about by the Covid-19 pandemic and come up with suggestions as to what can be done to move forward together.
“We also wanted to underscore the importance of private sector working with government when it comes to creating more jobs because government legislates the said policies and we go out in the field to create what government promises,” said Chimwaza.
Chimwaza added that the high rate of smuggling happening in the country is resulting into a drop in revenue of local businesses which are producing good quality goods as well as paying taxes faithfully.
“The people and the sector that is faithful in paying taxes is punished some more while those organisations importing smuggled low cost goods are not paying taxes,” he lamented.
“People who create jobs are the ones who suffer from smuggling. If smuggled sugar and drinks come in; local manufacturing goes down. As a result, instead of the country producing and exporting quality products we are ending up here constrained,” added Chimwaza.
Chimwaza said MCCCI would engage government to work out how the country can improve net income to the originating farmers of crops like maize so that the middlemen reduce a bit on what they gain from farmers.Follow and Subscribe Nyasa TV :