Zero Deficit Budget affecting SMEs – VP

Malawi’s Vice President and Peoples’ Party president Joyce Banda says Small and Medium Enterprises (SMEs) in Malawi are bearing the biggest brunt of the much touted Zero Deficit budget because there is fewer money in circulation.

Many think tanks described the zero deficit budget – a brainchild of President Bingu wa Muthatika – as fallacy saying it is modelled on 18th century economics, where you have estimated revenue on one side and estimated expenditure on the other.

They also said it is an economic fantasy because Malawi since independence has leant western consumption and not western productivity.

Banda: Mutharika's failed experiment on Zero Deficit budget

And JB, as she is fondly called, seem to agree saying the policies that government has implemented in the Zero deficit budget have meant that only few people in Malawi have lots of money and the rest are struggling to make ends meet.

“The obvious result is that they are not making money because people have no disposable cash. On top of that most of the SMEs have loans to settle but cannot,” Banda said.

She said this at Chenda Hotel in Mzuzu on Tuesday during the launch of the northern region Peoples’ Party Women Achievers Social Network.

MDGs threatened

Banda also said Malawi will never achieve the Millennium Development Goal on poverty eradication because the country continues to persecute people at the bottom of the poverty ladder by seizing their merchandise.

“Many women have gone home after Police and Council officials have confiscated their goods. In most cases the goods end up being eaten by the same Police and Council officials. And does any sane person expect these women to repay their loans and get out of the poverty cycle,” she queried.

The VP said the Peoples’ Party Women Achievers Social Network is a network where women regardless of status would meet and share experiences and business skills.

She said Malawians employed her to protect and uphold the constitution saying the constitution says Malawians must have their basic needs met.

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