Malawi Confederation of Chambers of Commerce and Industry (MCCCI) immediate past president Newton Kambala says government has for the past two years failed to meet the expectations of the private sector.
He said this during the Chamber’s 122nd Annual General Meeting (AGM) on Friday in Blantyre where he officially handed over the mantle to Karl Chokotho, who is managing director of CMA CGM Shipping Agency Limited.
Said Kambala: “I end my term at a time the economic environment in Malawi remains hostile for business. The year 2015 was no exception. As a result, business confidence continued to diminish in 2015. After the new government was ushered into power in 2014, the business community had high expectations.
“The business community felt that the new government would clear the economic mess left by the previous administration to win back donor confidence. This has not happened up to now and consequently, the donors continue to withhold direct budget support to government.”
However, International Monetary Fund (IMF) mission chief to Malawi Oral Williams last month said Malawi authorities have demonstrated a concerted effort to put the three-year Extended Credit Facility (ECF) programme back on track
This development could give a green light to bilateral donors to resume budgetary support which has been withheld since November 2013 due to concerns on Cashgate, the plunder of taxpayers’ money at Capital Hill in Lilongwe.
Already, the African Development Bank (AfDB) president Akinwuni Adesina said they expect to resume budget support in the 2016/17 fiscal year.
Kambala said there is minimal funding to the effect that development works that relied on government literally have no business, citing the construction industry.
He, however, said the shocks the economy suffered due to floods and drought in 2015 disturbed government budget because a lot of resources were diverted to easing the suffering of the victims.
A recently released Bertelsmann Stiftung’s Transformation Index (BTI) 2016 shows that Malawi has failed to make economic transformation gains for the past three years.
In an interview last week, Treasury spokesperson Nations Msowoya confirmed that government has not been able to make investments in any new transformative projects as a result of the shocks of floods, droughts and withdrawal of budgetary aid.
When presenting the Mid Year Budget Review in Parliament last month, Gondwe said he slashed budgets for some low impact projects to reduce expenditure in the 2015/16 fiscal year.