9 March 2016

Malawi: Govt Must Pay K30 Billion Private Sector Debt - MP

Nkhata Bay North member of Parliament (MP) Ephraim Mganda Chiume (People's Party-PP) has frantically pleaded with the government to repay a debt of K30 billion to private sector, saying the continuous withholding of the money is choking the already ailing economy.

Chiume, a former minister of Foreign Affairs during the Joyce Banda administration and also Minister of Justice during the Bingu wa Mutharika's DPP , said this in parliament.

"The economy cannot move if the government is not paying the debt to the private sector, .as it is said the private sector is the engine of the economy," said Chiume .

Malawi Confederation of Chambers of Commerce and Industry Chancellor Kaferapanjira expressed the same concern last week when he said the huge domestic debt is not only choking the economy but might derail government's effort to qualify for the extended credit facility with the IMF which is needed to give new life to the ailing and fast collapsing economy.

He said the alternative source of economic growth would be the private sector but then, the government owes the sector a lot of money.

Kaferapanjira said the banks are now reluctant to give loans to some businesses fearing that they will not pay back which is also affecting the banks as thrive on people's borrowing.

And speaking in parliament, Chiume said instead of cutting the budget, the Peter Mutharika administration would have factored in the K30 billion debt in order to repay to the struggling companies.

Chiume was commenting on the surprise cut of the budget by the government from K930 billion to K906 billion.

Most companies are now retrenching staff because of cashbook problems following the country' battered economy.

Malawi media giant Times Group gave notice it was retrenching up to 63 employees out of its nearly 200 employees due to the bad economy.

Times Group are publishers of the Daily Times, Malawi News, Sunday Times and owners of Times TV and radio.

Finance Minister Goodall Gondwe said the government is paying its debt to everybody including the private sector.

Malawi

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