Malawi’s debt has hit the roof and has skyrocketed from K5.6 trillion to K6.38 trillion in the past 12 months, the government has announced.
Breaking the bad news, Finance minister Sosten Gwengwe has disclosed that the country’s debt has jumped to K6.38 trillion, a development the country’s purse-keeper says this has forced the government engage into a higher gear in order to move to level 1 of Austerity Measures.
“We have moved to level 1 of austerity measures in a bid to manage the situation. It is going to be tough but that is the best way moving forward and will get better soon,” he said.
Finance Minister Hon Sosten Gwengwe
Speaking when delivering his statement on the State of the Country’s Economy at a National Youth Conference in Lilongwe, Gwengwe said debt is a monster making Malawi not to progress.
Said Gwengwe: “With that figure of debt, at the moment, every Malawian whether a baby, an adult or an older person, each is carrying on his or her shoulder a debt of not less than K600 000 kwacha.
The Finance minister, therefore, listed other economic constraints such as blackouts, saying the country is not producing enough energy and this has affected the economy adversely.
He said, the country has an economy with no enough energy a thing that has affected business and revenue generation.
Gwengwe also said that Malawi is also facing acute forex shortage a thing that has affected imports and its chances to attract money lenders.
Gwengwe told the Youth Conference that even IMF does not lend those with huge debt.
To get things better, Malawi need to increase its export base and go on level 1 Austerity Measure according to Gwengwe.
“Government is considering level 1 of austerity, if you hear of a complete travel ban don’t mourn because we are trying to run away from this debt trajectory and save some money,’’ said Gwengwe.
However, Former Finance and Economic Planning Minister Ralph Jooma who is also a legislature for Mangochi Monkebay and Member of the Parliamentary Budget and Finance Committee has asked government to impose austerity that suits all and not just ban local travels while those imposing the austerity go on international trips three times or more per year.
“The government must impose a uniformed austerity measures to everyone and not to exempt the connected few while the rest get a ban on local travels while those while the same people imposing such tough austerity measures to keep enjoying as if there are no restrictions,” said Jooma.
