<![CDATA[Malawi Blog]]> https://malawi.npub.pro/tag/finance/ https://malawi.npub.pro/tag/finance/rss/ episodic Tue, 26 Nov 2024 06:54:32 GMT Tue, 26 Nov 2024 06:54:32 GMT <![CDATA[Malawi in fiscal crisis, World Bank says]]> Tue, 26 Nov 2024 06:54:32 GMT https://malawi.npub.pro/post/malawi-in-fiscal-crisis-world-bank-says-dtbswd/ https://malawi.npub.pro/post/malawi-in-fiscal-crisis-world-bank-says-dtbswd/ naddr1qqhy6ctvv9mkjttfdckkv6tnvdskcttrwf5hx6tn94tk7unvvsk5yctwdvkhxctewvkkgarzwdmkgq3qls2af35r0u89n6tys2ngtypyy73sfmrtghna79cheavpn7ax99gqxpqqqp65wweer02 inflation naddr1qqhy6ctvv9mkjttfdckkv6tnvdskcttrwf5hx6tn94tk7unvvsk5yctwdvkhxctewvkkgarzwdmkgq3qls2af35r0u89n6tys2ngtypyy73sfmrtghna79cheavpn7ax99gqxpqqqp65wweer02 npub1ls2af35r0u89n6tys2ngtypyy73sfmrtghna79cheavpn7ax99gqx874sl This year's government budget deficit for Malawi - the shortfall on income compared to spending - is expected to be 7.6% of the GDP. While 42% of the budget is allocated to interest payments alone, another 38% are budgeted for wages, leaving only about 20% for "priority projects". The country's debt to GDP ratio is over 90% - "These are all features of a fiscal crisis", according to the World Bank, "which requires an urgent move away from business as usual".

A number of these loans are denominated in foreign currency, meaning that Malawi cannot simply print it's way out of this situation. The deficit can only be made up through:

  1. new borrowing in the short term, which will further increase the interest burden and worsen the situation
  2. fiscal austerity - reducing government spending - which is generally unpopular
  3. higher taxes, which is not popular either
  4. more tax revenue from growing business volumes, which will require a better business climate & outlook

#inflation #malawi #forex #worldbank #finance #crisis

Source

The Daily Times (Malawi)

]]> This year's government budget deficit for Malawi - the shortfall on income compared to spending - is expected to be 7.6% of the GDP. While 42% of the budget is allocated to interest payments alone, another 38% are budgeted for wages, leaving only about 20% for "priority projects". The country's debt to GDP ratio is over 90% - "These are all features of a fiscal crisis", according to the World Bank, "which requires an urgent move away from business as usual".

A number of these loans are denominated in foreign currency, meaning that Malawi cannot simply print it's way out of this situation. The deficit can only be made up through:

  1. new borrowing in the short term, which will further increase the interest burden and worsen the situation
  2. fiscal austerity - reducing government spending - which is generally unpopular
  3. higher taxes, which is not popular either
  4. more tax revenue from growing business volumes, which will require a better business climate & outlook

#inflation #malawi #forex #worldbank #finance #crisis

Source

The Daily Times (Malawi)

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