Budget statement courts mixed reactions

Joseph Mwanamvekha, presenting the 2019-2020 Budget statement
  • Implementation is key-ECAMA

  • MEHN hails carbon tax

  • People with albinism pleased

Finance Minister’s Joseph Nwanamvekha's budget statement presented on Monday in Lilongwe has attracted a mixed bag of reactions from different sectors of the country.

As at end December 2018, government debt stood at 62 percent of Gross Domestic Product (GDP).

During his presentation, Mwanamvekha assured the National Assembly and the public of policies Government has put in place, aimed at ensuring that debt will soon be declining in the medium to long term.

He cited the Medium Term Debt Strategy outlining measures which will translate into a reduction in domestic debt to 20 percent of GDP by 2023.

Given the macro stability and low interest rates, government plans to reduce domestic borrowing from K264.6 billion in 2018/19 fiscal year to K45.9 billion in 2019/20 fiscal year.

However Economics Association of Malawi (ECAMA) President Chikumbutso Kalilombe expressed concern over the county’s debt levels and feels this should have been significantly reduced.

He cautioned that working on assumptions is not good for Malawi’s economy and stressed on the need to further reduce the deficit.

Kalilombe: Budget implementation key to achieving economic gains

Commenting on the proposed increment of the Pay As You Earn (PAYE) tax free bracket from MK35.000 to MK45.000 per month, he viewed it as not significant enough considering the cost of living arguing that it has not hit on the relevance side.

Overall, he underscored the need to prioritise differently especially in a year where people are struggling, he called on the need for a balancing act.

Kalilombe observed that implementation is key so as not to end up into a wishful mode but to achieve efficiency and in the long term make economic gains.

An estimated K1.5 billion has also been budgeted for the purchase and maintenance of critical medical equipment in central and district hospitals such as MRI, CT Scan, Anesthetic Machines, ICU Ventilators, HDU Monitors and Dialysis Machines.

Malawi Health Equity Network (MEHN) Executive Director George Jobe hailed government for meeting some of the requests the organisation presented during budget consultation meetings.

Among others he cited the provision of the CT Scan which had been faulty most of the times, the proposal to buy a dialysis machine and an undertaking to rehabilitate equipment.

In an effort to mitigate the effects of climate change, government has introduced a Carbon Tax on local and foreign registered motor vehicles respectively.

As one of the health rights organizations, Mehn has been pushing for the introduction of carbon tax.

Jobe: Pledged to work with government in checking drug abuse and pilferage  

“We’re very happy that for the first time carbon tax has been introduced in the budget” explained Jobe.

He also applauded the removal of Customs Duty on motor cycles of cylinder capacity of not more than 100cc commonly called Zobandukato in a bid to promote rural transportation.

The MEHN boss explained that this will improve access to good health in rural areas but advised that drivers should undergo training and be licenced.

On the procurement of drugs, he said government should ensure that Malawians are fully benefitting and pledged to work with the Ministry of Health to avoid abuse and drug pilferage.

Kondowe: Described the proposed duty free clearance of sunscreen creams as a good initiative 

The duty free clearance of sunscreen creams, protective gear and community security alert alarms for use by people with albinism has excited Association of Persons living with Albinism In Malawi (APAM.

According to government, this measure aims at increasing accessibility of the products and promoting the welfare of people with albinism.

APAM coordinator Overstone Kondowe described it as a positive step, as it will ease the process to get the sunscreen creams which they import from India.

“It’s a very good initiative which will improve the welfare of persons with albinism”  commented Kondowe.

He also hailed the move to have duty free clearance of security alert alarms saying it will have a bearing on their security.