MGDS III implementation to cost K8.6 trillion

Implementation of the Third Malawi Growth and Development Strategy (MGDS III) is expected to cost about K8.6 trillion, including several flagship projects which the government and development partners expect to spur economic growth and reduce poverty.

President Peter Mutharika is due to launch the strategy at Kamuzu Palace in Lilongwe this morning, 18 months after the expiry of the predecessor strategy, MGDS II which run from 2011 to 2016 and ended without achieving its intended objectives.

The ambitious five-year strategy includes flagship projects projected at about K3.5 trillion to scale up public investments in the key priority areas of Agriculture, Water Development and Climate Change Management, Education and Skills Development, Energy, Industry and Tourism Development, Transport and Information and Communications Technology (ICT) infrastructure, and Health and Population.

According to a copy of the MGDS III which The Nation has seen, the funding outlook for flagship projects is in addition to an estimate of K5.3 trillion which has been planned to be spent on key priority areas.

In agriculture, the identified projects include Shire Valley Transformation Programme and construction of a new water source from Likhubula River in Mulanje to Blantyre for the Blantyre Water Board; in education, they include construction of Mombera University in Mzimba and construction and refurbishment of science laboratories and libraries in community day secondary schools while in energy and industrial development it is the construction of a coal fired power plant at Kammwamba and the Songwe River Basin Development Programme.

In transport, the government has prioritised the expansion of Chileka and Kamuzu international airports as well as rehabilitation and expansion of the Limbe to Marka and Nkaya To Mchinji railway lines while in health, construction of new district hospitals and construction and upgrading of primary health care services will comprise the flagship projects.

Reads the strategy in part: “With the emergence of private sector investors in the major growth sectors such as energy, water and communications, government policy will be to promote financing of flagship projects through Public Private Partnership arrangements.”

But effective and successful implementation of the MGDS III will depend on aligning national budgets over the next five years to the strategy, a feat that was not achieved with the previous strategy.

According to the copy of the MGDS III, the strategy will be funded through multiple sources of domestic revenues, external grants and borrowing.

At a time when development partners are channelling a lot of funds off-budget, MGDS III aims to streamline development assistance depending on the volume of funding, experience and the partners flexibility to align to national priorities and use government preferred aid modalities among others.

“To reduce further fragmentation of assistance and overcrowding of development partners in some sectors, the government will define for each development partner core areas of support not exceeding three sectors,” the strategy reads.

Malawi Economic Justice Network (Mejn) has since commended the effort to cost the strategy as one way of giving it impetus and direction.

Mejn executive director Dalitso Kubalasa said there was a need to conduct a development finance assessment and mapping of various sources of financing for the strategy.

He said: “This is a step in the right direction. It is time that we moved away from being known as a country that is policy rich but implementation poor. We should learn from failings in the past MDGS and learn fast.”

Kubalasa also hoped that with MGDS III, issues of mutual accountability would take centre stage and not politicking.

Last year, Minister of Finance, Economic Planning and Development Goodall Gondwe stated that MGDS III would need a lot of resources with development partners coming in to supplement.

Initially, the minister had said MGDS would require at least K2.5 trillion to implement but rested his hope on development partners increasing their support.

However, MGDS III has not outlined the mapping of resources to be expected from which specific sources over the five year period.