Corruption and lack of skilled and semi-skilled workers continue to impact on Malawi’s business environment, thereby thwarting efforts to attract foreign direct investments (FDI), according to a new report.
The 2017 Malawi Investment Climate Statement compiled by the Bureau of Economic and Business Affairs of the United States Department published on its website www.state.gov, said although the Government of Malawi has made efforts to combat corruption, the vice still remains a major obstacle to investment in the country.
Reads the report in part: “Scarcity of skilled and semi-skilled labour is another serious impediment to doing business in Malawi and is most acute in occupational categories that include accountants and financial management personnel, economists, engineers, lawyers, information technology and medical/health personnel.”
Malawi continues to perform poorly in fighting corruption, and dropped eight steps from 112 in 2012 to 120 in 2016 out of 176 economies with a score of 30 on the Transparency International (TI) Corruption Perception Index.
The country’s rank has potential to scare potential investors and development partners who use the CPI as a basis for estimating the levels of risks for business and investments.
The report, however, notes that while government continues to undertake various reforms to ensure that no tax, labour, environment, health and safety, or other laws distort or impede investment, procedural delays continue to impede business and investment approval process.
In an interview yesterday, Ministry of Industry, Trade and Tourism spokesperson Wiskes Nkombezi said government has instituted measures to address bottlenecks that impede the country’s doing business.
“The reforms are intended to remove and deal with these systematic bottlenecks that have to be dealt with. While it is not the responsibility of this ministry to spearhead the fight against corruption and address skills gap, we know that this is why government has taken a stand on skilled labour because we have these higher earning guys at the top and lower earning guys at the bottom, but we were lacking these guys. So, government is taking care of these through the technical colleges,” he said.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI) president Karl Chokotho is on record as having said that despite registering massive cases of corruption since 2013, the private sector has not seen any meaningful strategies to combat the vice.
“When corruption is on the rise and government behaves as if nothing is wrong, companies lose confidence in government policies because they do not speak to actions.
“As a result, the businesses take a back seat and do not feel that it is worthwhile continuing talking to government about the need to change policies because government is not listening,” he said.
Minister of Finance, Economic Planning and Development Goodall Gondwe is on record as having admitted that the 2013 Cashgate, in which K24 billion was stolen has had a long-lasting impact on the country’s economy.