In a proposal submitted to the Budget and Finance Committee of Parliament, the Malawi Confederation of Chambers of Commerce and Industry (MCCCI) has called on the government to establish a Special Purpose Vehicle (SPV) or Industrial Development Fund in the upcoming 2023/24 budget. The fund aims to provide patient capital for investments in the manufacturing sector, as the MCCCI believes that boosting manufacturing will lead to forex generation and promote import substitution.
According to MCCCI Chief Executive Officer Chancellor Kaferapanjira and Director of Policy and Advocacy Madalitso Kazembe, who appeared before the committee, the proposed fund would be made available for the production of products that can be manufactured within the country, especially those that can be exported or will substitute regular imports. They also called for special incentives to be provided to manufacturing entities to encourage investment, as well as tax incentives for manufacturing and processing industries that use a substantial portion of local inputs in their production, in order to give their products a competitive advantage over imported products.
The MCCCI’s proposal comes as the government looks to boost economic growth and promote import substitution, in an effort to reduce the country’s dependence on foreign goods and create jobs in the domestic manufacturing sector. The proposal also aligns with the government’s efforts to attract more investments in the manufacturing sector and boost the country’s foreign exchange reserves.
The Budget and Finance Committee of Parliament will consider the proposal as part of its review of the 2023/24 budget. The MCCCI hopes that the government will take their proposal into account as it looks to support the country’s economic recovery and promote sustainable growth.
