Covid-19 fourth wave threatens budget—Mlusu
Minister of Finance Felix Mlusu is concerned about the fourth wave of Covid-19 pandemic, saying it could affect implementation of the 2022/23 National Budget under formulation.
In an interview in Lilongwe yesterday on the sidelines of signing ceremony of two financing agreements with the World Bank, he said he was also worried that the fourth wave will likely dent earlier real gross domestic product (GDP) growth rate projection for this year.
Mlusu has been keeping his fingers crossed to attain a 3.8 percent real GDP growth rate in 2021, a projection which is four times higher than the 0.9 percent Malawi chalked last year.
But as he prepares to solicit input into the 2022/23 fiscal plan next week, the minister has already cited the new Covid-19 variant, Omicron, as single biggest headache for the forthcoming budget.
He said: “Obviously, Covid-19 is something that we need to worry and concerned about. As government, we obviously rely on businesses operating in our environment and these are the businesses that create revenue for government to use for its development projects.
“So, with Covid-19 still around and indeed the fourth wave that looks like will not escape easily, obviously that concerns us as government because it is going to impact lives of people and it is going to impact businesses.”
Mlusu said prior to the fourth wave, there were strong indications that businesses were starting to open up and recovering “and that may not be the case going forward with this fourth wave”.
Two days ago, Minister of Health Khumbize Kandodo-Chiponda confirmed that the fourth wave has hit the country and authorities have called for steady application and adherence to Covid-19 preventive measures.
In the same vein, health experts The Nation spoke to are worried that being the festive season, merry makers and politicians have abandoned their responsibilities, with few people adhering to Covid-19 preventive measures.
Justifying why there will be no mid-year budget review, Mlusu said the current financial year will run for nine months which is unusual and short “so there wasn’t enough time for us to be able to review the budget”.
Commenting on the performance of the K1.9 trillion 2021/22 National Budget, which is set to expire in March 2022, he said: “We are on track in terms of performance, but obviously challenges are still there. I can also say that we are on track in terms of performance and mandate, which Parliament gave us.”
In a separate interview, World Bank country manager for Malawi Hugh Riddell said the Bretton Woods institution believes that Malawi should vaccinate its people as fast as possible in view of the outstanding vaccine doses in stock.
On how best the country can cushion the poor from the adverse impact of the fourth wave, he said the country should leverage on the existing strong social protection system the government has built over the past decades.
He said: “We are investing in social protection system and we are also trying to scale that up.
“In addition, it is also important to support businesses and we are supporting small and medium enterprises through various facilities to make sure that businesses have liquidity to survive the difficult times.”
Riddell said in the medium to long-term, the bank wants to see growth coming back to Malawi.
In an interview on Tuesday, epidemiologist Titus Divala said the rising Covid-19 cases in Malawi and the entire Southern African Development Community region is a sign that people have to start being reserved in their daily life to minimise spread of the virus.
