Goodall says govt to devise zero-borrowing plan: Finance Minister rejects saying Malawi economy in God’s hands

Tough times call for Malawians as government has resolved to stop borrowing this year, a development that will affect delivery of public services in the country.

Minister of Finance, Economic Planning and Development Goodall Gondwe told Times Television’s ‘Point Blank’  program on Tuesday that this is one of the practical measures that government will implement this year.

“We have been borrowing a lot of money. Previously, mainly in last year’s budget, we were borrowing at the rate of 50 or so billion per month.

“But we have now reduced to 6 billion per month starting from last December. This is a tremendous adjustment.

“At the time when IMF said we were off track that was with respect to financial year of 2014/15. This year we have made tremendous adjustments and we are now borrowing much less and our aim is to completely halt borrowing between now and June this year,” asserted Gondwe.

The Finance Minister said if they stop borrowing while budgetary support is not there, “we will have to adjust our expenditure and a number of some services will not be offered to the public”.

He added: “The consequences are clear. We will have to look at a number of some things where we need to have some cuts.”

Asked if that will not be a compromise on lives of Malawians, Gondwe said, “It’s what people have called sacrifices.  All of us we have to sacrifice in order to make up for what has happened. You can’t just have cashgate and use all the money and hope life will be normal.

“We lost a lot of money through cashgate, and we had to borrow to make up for that.”

Gondwe further said government will come up with policy issues that would  necessitate that everybody, including the Executive (President and Cabinet Ministers) faces the sacrifices that are needed.

The Finance Minister also took trouble to refute media reports claiming that he said that “the country’s economy is in God’s hands”.

“I don’t remember to have said that, it’s not in my vocabulary. Yes, everything is in God’s hands, but that is not what is said at all. It’s not in my vocabulary.

“The country’s economy is certainly firmly in government’s hands and certainly, we appeal to mighty God to help us to do the right things.

According to him, what the nation is passing through is not different from what a number of other countries [Tanzania, Thailand, Zambia and Korea, among others] are passing through.

“We will continue to adjust the national budget and balance the sums to get going.

“The fact that we are short of foreign exchange, it means we will have to take measures that will enable us to earn more foreign exchange to make up for what we have lost.

“We also hoped to have favorable weather to get enough food that the nation require and be in a position to reduce the inflation rate,” he explained.

He said if the inflation rate is reduced, “it is possible for us, more appropriately, to reduce the interest rates, and if interest rates are reduced, we will have an economy whose activities will be increased resulting in normal growth.”