There are fears that government\u2019s appetite for borrowing, especially domestically, which is expected to increase significantly in the 2018\/19 national budget, will become unsustainable and squeeze most investors out of business in the course of time, thereby affecting economic growth.<\/p>\n
But Budget Director, Peterson Ponderani, has downplayed the fears, saying the borrowing is simply aimed at making sure different sectors\u2014 including those that are supposed to generate resources for the implementation of the budget itself\u2014 operate optimally.<\/p>\n
In his presentation during a 2018\/19 budget analysis public hearing that took place in Lilongwe yesterday, Parliament\u2019s committee section Public Finance Analyst, Mphatso Ackim, feared that the country\u2019s borrowing would soon become unsustainable.<\/p>\n
\u201cGovernment borrowing has soared by 32.26 percent from the revised 2017\/18 estimate of K183.6 billion to K242.9 billion estimate for the 2018\/19 financial year.<\/p>\n
\u201cWhereas foreign borrowing has declined by 56.3 percent from the revised estimate of 2017\/18, domestic borrowing has skyrocketed by 473.6 percent from K30.7 billion in the revised 2017\/18 to K176.1 billion in the 2018\/19 financial year,\u201d Ackim said.<\/p>\n
He said such borrowing trends can have adverse implications on lending rates and access to loanable funds by the private sector.<\/p>\n
Ackim said although the debt situation is within sustainable levels, the country is at a breach of registering unsustainable debts and the surge in domestic borrowing risks crowding out private sector investors.<\/p>\n
\u201cThe governmen t must tightly control expenditures by ministries and parastatals to avoid fiscal slippages which may force government to borrow. Interest payments alone are absorbing 11 percent of the national budget,\u201d he said.<\/p>\n
Responding to such concerns and others from stakeholders in the social sector, Ponderani said it is ironic that while most sectors are asking for more funds, they are also condemning the government for \u2018excessive\u2019 borrowing.<\/p>\n
He also added that while the social sector\u2014which includes health, education and agriculture\u2014is an important one, others equally need attention in terms of resource allocation.<\/p>\n
\u201cWhen we ask for more funds to a specific sector, we must also look at inflows. Most of the presentations here have looked into expenditure without looking at where the funds are coming from.<\/p>\n
\u201cSome of you are asking government to minimise on domestic borrowing, yet you are also asking government to increase expenditure. We must balance the two realistically,\u201d he said.<\/p>\n
Presentations from United Nations Children\u2019s Fund, Civil Society Education Coalition, Malawi Health Equity Network and ActionAid have also called for adjustments in budgets to the education, health, agriculture, gender, disability and social welfare sectors to address pressing needs.<\/p>\n","protected":false},"excerpt":{"rendered":"
There are fears that government\u2019s appetite for borrowing, especially domestically, which is expected to increase significantly in the 2018\/19 national budget, will become unsustainable and squeeze most investors out of business in the course of time, thereby affecting economic growth. But Budget Director, Peterson Ponderani, has downplayed the fears, saying the borrowing is simply aimed […]<\/p>\n","protected":false},"author":3,"featured_media":65992,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-65987","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/65987","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/comments?post=65987"}],"version-history":[{"count":1,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/65987\/revisions"}],"predecessor-version":[{"id":65993,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/posts\/65987\/revisions\/65993"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/media\/65992"}],"wp:attachment":[{"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/media?parent=65987"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/categories?post=65987"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/archive.times.mw\/index.php\/wp-json\/wp\/v2\/tags?post=65987"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}