While the country’s economy is struggling with local and international loans and their accumulative interest, the government says it does not know what to do with K16.2 billion it earned after selling Malawi Savings and Inde banks three years ago.
Ministry of Finance spokesperson, David Sado, said on Friday the money was still stashed at the Reserve Bank of Malawi (RBM) as the government has not figured out what to do with the money.
“The money is there at the Reserve Bank of Malawi. There are several options we are looking into and, when the government makes its decision, we will come back to you. We want to invest the money in projects that [may help us] benefit out of it. We are looking at several investment projects such as irrigation,” he said.
However, the government is heavily laden with debts and accumulative interests which are choking the economy.
Finance Minister Goodall Gondwe announced when he presented the 2018/19 budget statement in Parliament two weeks ago that the interest payment bill has been projected at K182.9 billion, representing 12.19 percent of the national budget.
This year alone, Capital Hill again intends to borrow K242.9 billion to finance its operations from July 1 to June 30 2019, K176.1 billion of which will be borrowed locally.
University of Malawi economics professor, Ben Kalua, said the big question is whether the money is, indeed, there at RBM as the government claims.
“It is inconceivable that a poor Malawi can afford to keep K16 billion for three years not knowing what to do with it. Again, K16 billion of 2015 is not the K16 billion of this year. Surely, the money is losing value,” he said.
Kalua said the government cannot be trusted to keep the money for three years looking at how it has been doing in public finance management and the intended K4 billion payout to Members of Parliament.
While K16 billion remains in the bank, construction works of a 16-kilometre duo carriage road from Clock Tower Roundabout in Blantyre to Chileka Airport costs about K11 billion. The other K5 billion could, therefore, be used to construct another road which could uplift lives of Malawians.
In May 2015, the government sold Malawi Savings Bank to FDH Bank to the tune of K9.5 billion while Inde Bank was sold to National Bank of Malawi at K6.7 billion against strong advice from other quarters.
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