Minister of Finance, Economic Planning and Development Goodall Gondwe has asked Japanese Government to consider increasing financial assistance to Malawi on Economic and Social Development Programme.
Speaking during the signing ceremony of 200 million Japanese Yen (KI.3 billion) Grant Aid on Wednesday in Lilongwe, he observed that Japan’s financial assistance to Malawi has since been reduced.
“Japan used to give us more money in the past, but now it has been reduced,” Gondwe noted.
The request comes amid Japan’s dwindling financial assistance to Malawi through the said window over the years since 1988 when the country started benefiting from the grants.
The resources have been utilised to assist a wide range of small and medium enterprises (SMEs) to acquire, through loans, various operating or capital goods, plant or equipment purchased from abroad.
The Minister attributed reduction of the financial assistance to low and non repayment of the loans acquired from the package by some small and medium entrepreneurs in the country.
He explained that the development led to the disappointment of the donor.
Gondwe noted that once the assistance is increased it would enable the country to implement various projects without difficulties and pledged to properly account for the funds and use the resources in a transparent manner.
“I would like to assure Your Excellency that on our part, we will use the assistance solely on the intended purpose,” he assured.
The Finance Minister appealed to beneficiary companies that still owe the programme money to speed up payments.
“Please note that the new grants to the country will depend very much on how quickly beneficiary companies pay back their loans,” he added.
Japanese Ambassador to Malawi, Kae Yanagisawa said the Grant Aid is intended to compliment the country’s efforts to promote economic and social development and eliminate poverty.
The Ambassador said the grant would be used by Malawi Government to procure goods and equipment to support small and medium enterprises (SMEs) in enhancing their business operations.
The grant, previously known as Non-Project Grant Aid, has been provided to the country since 1988 and has now totaling US$ 45 million (MK33 billion), including the just signed agreement of K1.3 billion.