An expert says while the foreign debt burden has risen to levels that bring serious concern to the country, government would still be justified if it borrowed to finance the proposed Greenbelt Authority as it would mean investing in infrastructural development which is good for the long-term success of the economy.
The expert, who is a professor of Economics at Chancellor College, Ben Kalua, said of the five strategic policies that government identified in the 2016/2017 national budget, the establishment of a Greenbelt Authority should be considered a priority as the country would benefit most if it engaged in large scale irrigation initiatives.
Kalua said instead of borrowing for consumption, government must now begin to channel resources towards development of infrastructure to help the country move out of its perennial economic challenges.
“Malawi is endowed with vast water resources which make it a viable venture to finance structural development to bring efficiency to irrigation farming to boost the contribution of agriculture to Malawi’s gross domestic product,” he said.
Kalua insisted that by doing so, Malawi’s traditional donors would even be sympathetic to the country arguing that donors are happy with infrastructural development other than just wasting resources on consumption.
“It’s a highly precious budget with a lot of demand placed on it but there is nothing wrong with borrowing, just don’t borrow for consumption. If we are serious about it, no-one will complain. We are in a long term mess right now and the only way out is to engage strategies that also bring long term results,” he said.
According to Finance Minister, Goodall Gondwe, government is currently engaging the World Bank and other potential investors to set-up irrigation schemes in the Lower Shire, Bwanje Valley and Songwe and he says it will be the duty of the Greenbelt Authority to negotiate on the technicalities and also act as executing agent.
“It is hoped that once the irrigation infrastructure is done, they will be dealing with farmers who want to use the irrigated land,” he said.
Gondwe justified the proposition of setting up the authority arguing that previously there was disjointed action on the implementation of the Greenbelt initiative.
“The authority has its own budget and staff which was not the case in the past. We are making some progress because now we have an organisation responsible for irrigation matters, more specifically large scale irrigation farmers as the Ministry of Agriculture will still be responsible for small scale irrigation initiatives,” he said.
In his presentation of the 2016/2017 national budget the finance minister identified five strategic policy aspects including the creation of a Greenbelt Authority to be addressed by the current financial plan. Government has also proposed strategic action on climate change mitigation, addressing food security, boosting rural incomes, reforming the Farm Input Subsidy Programme, strengthening national development planning and national registration.
Bu t some experts have since faulted the government’s strategic direction arguing that it does not offer hope that Malawi will soon diversify from a predominantly agricultural based economy
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