REPUBLIC OF MALAWI STATEMENT BY HIS EXCELLENCY, PROF. ARTHUR PETER - PDF document

REPUBLIC OF MALAWI STATEMENT BY HIS EXCELLENCY, PROF. ARTHUR PETER MUTHARIKA, PRESIDENT OF THE REPUBLIC OF MALAWI ON THE OCCASSION OF THE PRESENTATION ON MALAWI’S PRIORITIES AND PARTNERSHIPS: DIVERSIFICATION FOR DEVELOPMENT, AT THE CHATHAM HOUSE, LONDON, UNITED KINGDOM, 30TH NOVEMBER, 2015 0 | P a g e

1. It is a great honour and privilege for me to address this august house under the topic “Malawi’s Priorities and Partnerships: Diversification for Development.” 2. As most of you may be aware, Malawi is a democratic nation in South East Africa with a stable social, political and economic environment; liberal trade policies; and strategic geographical proximity with neighbouring Mozambique, Zambia and Tanzania. 3. I emphasise strategic, because there is a tendency to look at landlocked countries like Malawi as ‘doomed’ but my government’s approach is shifting to viewing our neighbours as providing potential opportunities for development partnerships that can mutually benefit our countries’ economies. 4. Malawi is a land-linked country. Despite having recently discovered minerals, my country’s economy is largely agro- based with agriculture accounting for eighty-five of all exports. Distinguished Ladies and Gentlemen 5. I am particularly delighted to speak about “Malawi’s Priorities and Partnerships: Diversification for Development.” Malawi’s development trajectory has been associated with growth based 1 | P a g e

on agriculture in the absence of significant contributions from the manufacturing or minerals sub sectors. 6. As a new government, we are now moving on a path for economic diversification away from the commodity based economy, in order to increase the export base. We strongly believe that trade and investment are key drivers for inclusive economic growth and sustainable development. Thus, without investment, then sustainable development is impossible. 7. My Government recognizes the critical role the private sector plays in contributing to sustainable economic growth and development. Mobilizing investment to support sustainable development remains my government’s number one priority areas, as clearly outlined in the Malawi Growth and Development Strategy (MGDS) II; the overarching medium term development strategy designed to attain Malawi’s medium to long-term development aspirations. 8. To that end, my government is pro-actively addressing market failures by among other things prioritizing; energy, tourism and infrastructure development, through the public private partnerships, including government own financing. 2 | P a g e

Distinguished Ladies and Gentlemen 9. My Government’s priorities are in line with Vision 2020 aimed at transforming Malawi into a democratically mature, environmentally sustainable, self reliant and technologically driven middle income country. The achievement of this Vision is implemented, through medium term strategies covering a period of five years, since 2000. 10. The priorities of the Malawi Government under the current Malawi Growth and Development Strategy (MGDS) II for 2011- 2016 are derived from six broad thematic areas, namely: i. Sustainable Economic Growth; ii. Social Development; iii. Social Support and Disaster Risk Management; iv. Infrastructure Development; v. Governance; and vi. Gender and Capacity Development. 11. Within these six thematic areas, the MGDS II isolates nine key priorities areas (KPAs), as follows: i. Agriculture and Food Security; ii. Transport Infrastructure; iii. Energy, Industrial Development, Mining and Tourism; iv. Education, Science and Technology; v. Public Health, Sanitation, Malaria and HIV and AIDS Management; vi. Integrated Rural Development; vii. Greenbelt Irrigation and Water Development; viii. Child 3 | P a g e

Development, Youth Development and Empowerment; and ix. Climate Change, Natural Resources and Environmental Management. 12. The key objective of the MGDS II is designed to attain Malawi’s long term’s development aspirations of wealth creation and poverty reduction, through sustainable economic growth and infrastructure development. Similarly, the MGDS II implementation was also earmarked to achieve the United Nations Millennium Development Goals (UNMDGs). 13. Since the launch of the MGDS II, a lot of development programmes have been implemented, through the Public Sector Investment Programme and other programmes involving Public Private Partnerships (PPP) arrangements. The aim is to enhance economic growth and development in Malawi. 14. It is important to note that some progress has been realized in various sectors. For instance, the Government has increased the bituminous road network in both urban and rural setting to facilitate mobility of goods and people across the country, and improve access to markets. Currently, our efforts are being taken to increase production of energy, which is one of the 4 | P a g e

stumbling blocks undermining investments, therefore impeding developments in this regard for Malawi. 15. As I earlier alluded to, Malawi is largely agro-based - as such, Government has taken some steps to increase investment in this sector. For example, the Government is implementing Green Belt Initiative, an irrigation initiative which will stretch over one million hectares across Malawi, with the aim of reducing dependency on rain-fed agriculture. The aim is to increase productivity of agricultural land and ensure that smallholder farmers are participating in productive agriculture to sustain their own livelihoods as well as contribute to national economic growth. Chairperson, Distinguished Ladies and Gentlemen 16. The realisation of the MGDG II and MDGs targets required enormous resources, which could not be mobilized by Government alone but also through partnerships with cooperating partners, including the United Kingdom, the European Union, the United States, the World Bank, the African Development Bank (AfDB), Germany, Ireland, Norway and many others. 5 | P a g e

17. In that regard, a Development Cooperation Strategy (DCS) for Malawi was developed in collaboration with our cooperating partners. This strategy advocates for inclusive partnerships, government leadership and country ownership of the national development agenda in line with the Paris Declaration on Aid Effectiveness, Accra Agenda for Action and the Busan Global Partnership for Effective Development Cooperation. Chairperson, Distinguished Ladies and Gentlemen 18. In summary, the partnerships played a crucial role in the implementation of the eight (8) United Nations Millennium Development Goals (UNMDGs) for 2000 to 2015. My government managed to attain four of the eight goals on Reducing Child Mortality; Combating HIV and AIDS, Malaria and other diseases; Ensuring Environmental Sustainability; and Developing Global Partnership for Development. 19. My government will, therefore, devote its energies to fulfil the remaining four MDGs on Eradicating Extreme Poverty and Hunger; Achieve Universal Primary Education; Promote Gender Equality and Empower Women; and Improve Maternal Health under the framework of the recently adopted 2030 Sustainable Development Goals (SDGs). 6 | P a g e

20. We will also continue to implement programmes and interventions aimed at sustaining progress made. Just like the MDGs, my government recognizes that the achievements of the SDGs will depend on the availability of adequate resources. It is for this reason that government will continue to harness efforts of all stakeholders, including the private sector, development partners, and civil society organizations (CSOs), in order to achieve the goals that have been outlined in the SDGs. Chairperson, Distinguished Ladies and Gentlemen 21. Allow me, to use this opportunity to highlight one of the main challenges that my government faced when implementing the MDGs, which may also recur in the SDGs. Our cooperating partners stopped providing budget support following a pilferage of public funds also known as “cashgate scandal” that occurred in the previous administration in 2013. Donor support is now being provided outside the government budget making it difficult to monitor and evaluate the impact of these off budget programmes. 22. In the meantime, my government is working tirelessly to bring transparency and accountability in the implementation of the public finance management systems and seal all loopholes in 7 | P a g e

the government system. These efforts will assist us to bring back on track the International Monetary Fund (IMF’s) Extended Credit Facility (ECF) Programme with Malawi by December, 2015. The restoration of the IMF’s ECF may also allow the resumption of budgetary support by the European Union and the World Bank. It is hoped that the United Kingdom and other Governments of goodwill will also consider resuming budget support to Malawi as we have sealed off the loopholes on our public financial management system. Chairperson, Distinguished Ladies and Gentlemen 23. As stated earlier on, Malawi’s economy is agro-based and remains the country’s main foreign exchange earner with tobacco, sugar, tea, coffee and cotton as major export products followed by manufacturing and tourism. The country’s dependence on this sector renders our economy vulnerable to external shocks hence the need to diversify. 24. Joseph Stiglitz, Nobel Prize Winner for Economics 2001 stated and I quote “The globalization of the economy has benefited countries that took advantage of it by seeking new markets of their exports and by welcoming foreign investment.” 8 | P a g e