BAM ask government to create conducive environment for doing business
Bankers
Association of Malawi (BAM) have asked government to create better conditions
for business and investment so that Malawian businesses are not lag behind from
what other business from other countries within the region are doing.
BAM president Mishek Esau made the call when
presenting a topic ‘Doing business in Malawi: a financial sector perspective’
where he indicated two key annual reports on doing business by the World
Economic Forum (Malawi: 132/144) and the World Bank (2015 Mw: 160/189) and the local
key report produced by MCCCI have clearly shown that “Favourable conditions
expected by the business community to be present in a country for business and
investment to flourish in relation to other countries”
“We
might do well this year and move a step, but also other countries are also on
the move and that’s the most important thing. So we are in competition with
each other” said BAM President Mishek Esau
“Countries
are in competition with each other for foreign direct investment and also trade
opportunities. Malawi needs to create a conducive environment to be able to
compete on the world stage. Bankers are saying Malawi as a country we are too
disorganised to compete on the World stage!”
BAM has among others mentioned that the country must
improve on address
challenges that business community are experiencing including unstable economic environment which makes
long term planning problematic and cost of doing business which is too high. He
in this respect mentioned high
interest rates, high inflation rate and unstable exchange rate.
Esau
said the solution is to create an
enabling environment by a complete overhaul of monetary policy to one
that reflects the realities, enhance fiscal discipline as well as reviewing of
Monetary policy transmission mechanism.
BAM president also mentioned poor infrastructure of
roads, energy, water and
telecoms. He urged government to accelerate public sector investment programme
through alternative ways of financing such as bond issues, Ring-fencing of
statutory levies for investment like road levy, MAREP levy to service bond
issues for development and invest in toll gates on roads where people must pay
whenever they enter into a district or a city.
“Almost
all commercial parastatals like Blantyre Water Board where we are experiencing
frequent disruptions in water supplies can raise money in this way if they were
well managed!” he said
BAM
also indicated that there is under-developed
capital market and that Security lapses is threatening confidence to
businesses which MCCCI Chief Executive Officer Chancellor Kafera Panjira when
making his presentation on ‘Cost of
doing business’ also mentioned similar concerns including water
disruptions particularly Blantyre Water Board, as areas consistently remain key
constraints to economic development.
But
speaking on some of these areas before engaging in camera discussions with the
business community, President Mutharika gave hope to the business community
that his government is trying to address these issues.
On security President Mutharika said “Recent
high profile insecurity incidents may sow seeds of panic but this will not
derail Government’s commitment to protect the economic interests of all companies
against criminal activities.”
He said his government is making sure that
security institutions have adequate resources “Additionally, Government will
continue to enhance the capacity and professional competence of our
security institutions to enable them to respond adequately to the security
needs of the private sector.”
On Energy President Mutharika also mentioned
that “Our Government will increase availability of reliable, sustainable and
affordable energy. The current lack of access is one of the main obstacles
for productivity growth and industrialisation. Therefore, this Government is in
the process of enhancing the efficiency of the services of the Electricity
Supply Corporation of Malawi (ESCOM) by separating its functions into
electricity generation, distribution and marketing.”
He said “A US$ 350.7 million
grant from the Millennium Challenge Corporation has been secured and is funding
a Power Sector Revitalisation Project (PSRP). Furthermore, we are incentivising
private sector companies to invest in the Energy sector through PPPs. At the
end of this process, we shall see a thriving electricity sector that supplies
enough energy to all Malawians.”
And
concerns on infrastructure President Mutharika has assured the business
community in the country that “Our government will improve transport
infrastructure for traffic by road, rail and air and will prioritise those with
economic drive.”
“We
recognize that good transportation infrastructure can be a catalyst for
agricultural development, industrialisation and trade. Therefore, this
Government plans to improve road infrastructure through the resuscitation and
construction of a number of roads, the rehabilitation of railway networks that
can link all of Malawi to the Nacala corridor, and the construction and upgrading
of international airports.”
“Government
is committed to operationalize the Nsanje Inland Port. I am convinced that
these projects, if successfully implemented, will significantly increase the attractiveness
of Malawi as a destination for investors and tourists.” Said President
Mutharika before engaging holding discussions with the business community in camera
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