Economists Association of Malawi (Ecama) has urged government to improve its revenue projections which form the basis for budget formulation.
Ecama president Lauryn Nyasulu said in an interview that this could help improve revenue mobilisation and efficiency in revenue collection for the public tax collector Malawi Revenue Authority (MRA).
“Treasury has a challenge to ensure the budget reflects the real situation on the resource envelope,” she said.
The initial 2019/20 budget framework put total expenditure and net lending at K1.74 trillion, while inflows of revenue and grants were approved at K1.58 trillion, giving a total financing requirement of K162.1 billion.
Meanwhile, Treasury is projecting a fiscal deficit of about 3.7 percent of gross domestic product ( GDP) to be financed by domestic borrowing of K203.3 billion, representing 2.4 percent of GDP.
World Bank country manager Greg Toulmin also earlier indicated that achieving a budgeted fiscal deficit for this financial year will be a challenge; hence, the need to strengthen fiscal discipline.
He said: “Treasury needs to carefully manage increased expenditure pressures to avoid incurring a huge deficit.”