Public expenditures almost doubled to K276.2 billion in February 2022 from K142 billion in the preceding month, published Reserve Bank of Malawi (RBM) figures have shown.
In its February 2020 Monthly Economic Review published on Thursday, RBM said the rise was due to increased spending in the recurrent and development budget lines.
Reads the report in part: “Spending lines under recurrent expenditures increased by 70.5 percent [K87.2 billion] to K210.8 billion and this was reinforced by a K47 billion rise in development expenses to K65.3 billion during the same period.”
However, domestic revenues declined by 13.2 percent or K17.1 billion to K112.4 billion during the month under review due to a combined effect of decreases of K15.9 billion in tax revenues and K1.2 billion in non-tax revenues, according to the report.
This, however, did not affect total revenues collection during the month under review, which saw revenues registering a monthly increase of 11 percent (K15.8 billion) from K144.1 billion in January 2022.
Meanwhile, Treasury closed the month with a deficit of one percent of the gross domestic product (GDP), a decrease from the surplus of 0.02 percent of GDP recorded at end of January 2022, and compared to a deficit of 0.4 percent of GDP reported for February 2021.
In a Twitter post announcing his arrival in New York, United States for America on Saturday to attend the 2022 United Nations (UN) Economic and Social Council Forum for Financing Development, Vice-President Saulos Chilima said expenditures continue to choke the country’s budget; hence, there is need to find solutions.
He said: “There are expenditures that choke our budget and we need to decisively deal with such issues that include our debt situation and our earnings.
“We will also pick up on some of the engagements that the President had, including a few bilateral engagements. We will also have a meeting with the UAE [United Arab Emirates] and others to continue to boost our international relations.”
In analysing the 2022/23 expenditure earlier, Budget and Finance Committee of Parliament chairperson Gladys Ganda said they noted that total expenditures have continued to increase in the proposed budget to K2.840 trillion from an approved estimate of K1.955 trillion in the 2021/22 financial year.
This, she said, represents 42.3 percent increase and 6.8 percent increase from a 12-month expenditure equivalent of the outgoing financial year. Ganda expressed concern that recurrent expenditure continues to dominate the budget as it claims 71.1 percent of the 2022/23 National Budget, estimated at K2.02 trillion from K1.424 trillion 2021/22 likely outturn.