By Lovemore Khomo
Minister of Finance and Economic Affairs Simplex Chithyola Banda has unveiled a revised 2023/24 National Budget from K3.79 trillion to K4.33 trillion.
Chithyola Banda presented the Mid-Year Budget on Monday in the National Assembly in Lilongwe.
He said total public debt stock has increased from K10.60 trillion to K12.56 trillion with the recent re-alignment of the Kwacha, and a total revenue and grants amounted to MK1.45 trillion against a midyear projection of MK1.25 trillion.
The minister further announced that mid-year outturn for domestic revenues is estimated at MK1.18 trillion against a projection of MK1.09 trillion and domestic revenue, tax revenue is estimated at MK1.03 trillion while other revenue (non-tax) is estimated at MK151.8 billion.
“Total Grants disbursed in the first half amounted to MK273.40 billion against a mid-year projection of MK155.30 billion. Projected grants for the fiscal year have been revised upwards to MK645.94 billion representing 4.2 percent of GDP from an earlier projection of MK310.59 billion which was 2.01 percent of GDP.
This upward adjustment reflects additional confirmed disbursements from development partners following the ECF program.” He explained.
Chithyola Banda told the August House that at the end of the fiscal year, domestic revenue is projected to go up from MK2.24 trillion to MK2.41 trillion. Of the total domestic revenue, taxes will account for MK2.20 trillion while other revenues will amount to MK209.34 billion. This represents a 3.3 percent upward revision on tax revenues from the approved position.
External debt now accounts for 53 percent of the revised total debt stock while the remaining 47 percent is domestic debt.
“Prior to the realignment, external debt accounted for 44 percent of the total debt stock while 56 percent was for domestic debt as the change in the Public debt stock post-realignment is driven by an increase in external debt expressed in Kwacha from K4.66 trillion to K6.62 trillion.” Said Chithyola Banda.
Chithyola has however said government will continue addressing persistent budget deficits despite the pressure emanating from the exchange rate correction.
Following the recent approval by the International Monetary Fund Executive Board, the country has secured support through the Extended Credit Facility amounting to USD174 million covering the next four years.
Foreign support is expected to help the stabilize the economy thereby putting our economy on a growth trajectory as Malawi will get about $240 million from development partners.
Finance Minister had break-down the grants into three where World Bank will support with $80 million, African Development Bank $30million and 60 million Euros will come from the EU.
