World Bank economists urge strong reforms

Malawi needs to pursue reforms that will sustain  macroeconomic stability, foster transformation of the agriculture sector, and encourage private sector development that provides productive income-generating opportunities for the growing population, the World Bank has advised.

In a recent Country Economic Memorandum (CEM), the authors—Richard Record, Priscilla Kandoole and Praveen Kumar—note that the country will have to move beyond “business as usual”  to address developmental challenges and achieve stable and sustained economic growth and poverty reduction,

CEM further states that progress is needed in terms of fiscal management and better allocation of fiscal resources to focus on areas that have the most impact on growth and poverty reduction.

“The immediate goal of the government should be to restore and entrench macroeconomic stability, a prerequisite for fostering private investment in the economy and over the medium-term to develop a track record in sound economic management,” reads the memorandum in part.

With regards to reforms that would foster private sector development and creation of job opportunities, the authors advise on removing barriers to entry, address deficits in utility supply, improve the road transport system and develop infrastructure and systems to exploit the opportunity of the modernised Nacala railway corridor.

In a previous interview, finance and corporate strategy expert James Kamwachale Khomba said the country needs to create an environment that will enable businesses to grow and graduate from small to medium enterprises which can only be achieved if necessary infrastructure and facilities are in place.

European Union Ambassador Marcel Gerrmann is on record as having urged government not to be complacent with the current business environment, saying there are a lot of areas relating to markets and stability that need to be addressed.

Gerrmann was speaking in response to Malawi recent improvement on the World Bank Doing Business, having moved up 23 steps to position 110 from 133 last year, almost making it into the top 100. n