A Mid-Term Review of the Malawi Growth and Development Strategy (MGDS) III has revealed low donor trust in the country’s procurement and financial management systems.
The analysis, which was done by the National Planning Commission (NPC), shows that there is low donor use of Malawi’s procurement systems, low trust in the Public Finance Management systems and unpredictability of aid flows.
The analysis further shows that delivery of aid in achieving the sector goals was affected by bureaucracy in the funding institutions.
The analysis faults donors bureaucracy for prolonging time from expression of interest to fund a project, to the time of committing the project finance and the time-consuming procurement processes.
NPC director general Thomas Chataghalala Munthali said in an interview on Monday that the revelation is a wake-up call for authorities to consider using locally generated resources for projects.
He said the country has not developed significantly because of over-reliance on donors whom he said have different interests than the country’s development priorities.
“We need to consider greater use of public capital market financing for infrastructure projects, including public private partnerships,” said Munthali.
On his part, Public Procurement and Disposal of Assets Authority director general Elias Hausi said in a written response on Monday that laws allow donors to use external procurement systems as they have to spend their money in a manner that maximises value for their countries.
He said for major procurements, donors use their own procurement guidelines, adding that for procurements below a certain threshold, they use the country’s procurement laws, especially those under national competitive bidding.
Said Hausi: “The public procurement regulations recognise that donor procurement guidelines are given priority over local laws where the donor has opted as such.
“Donors have also to be accountable to their nations because it is their people’s taxes that are being used.”
Ministry of Finance spokesperson Williams Banda said the report findings are eye-opening.
“We will review the recommendations to improve on the underlined areas,” he said.
Betchani Tchereni, associate professor of economics at The Polytechnic, a constituent college of the University of Malawi, said in a written response on Monday that loss of trust from donors is a huge concern.
“We must remember that all these resources be it donations or soft loans are actually taxpayers money in other countries,” he said.
Last year, Roy Stewart, a Conservative Party legislator was quoted by The Times of London as having said that Malawi’s state of impoverishment has worsened despite it getting £4.5 billion (about K4.5 trillion) from Britain in form of aid for the past 50 years.
The five-year MGDS III runs from 2017 to 2022.