Minister of Trade and Industry Simplex Chithyola says government plans to negotiate with financial institutions to consider giving small and medium enterprises (SMEs) affected by Tropical Cyclone Freddy more time to repay their loans.
The proposal comes amid fears by some SMEs who obtained loans from commercial banks and other financial institutions on how they will service their loans after their businesses were affected by the disaster.
Speaking in Lilongwe on Monday on the sidelines of the handover of a K10.3 million donation by Common Market for Eastern and Southern Africa (Comesa) Competition Commission to help the country mitigate against the impact of the cyclone, Chithyola said his ministry was planning to meet the financial institutions on the issue.
He said: “I’m just coming from the Southern Region for a preliminary assessment of the damage on the business sector and the major concern for most business operators, especially those who got loans from micro finance institutions, is on how they would repay their loans.
“Let me assure them that as a ministry, we will do our level best to negotiate with such financial institutions to give breathing space to the victims for servicing the loans. We are planning to do this after a full assessment of the damage.”
He said besides causing deaths, injuring and displacing people from their homes, the disaster has heavily damaged the road infrastructure and agricultural produce which will have a bearing on the country’s trade and economy.
Chithyola further asked for more support from well-wishers for the victims and the business community affected by the disaster in the region.
Presenting the donation, Comesa Competition Commission director Willard Mwemba said they hope the support will enable the victims to get food and other basic needs.
He said: “The calamity has brought untold misery not only to Malawi, but the Comesa Competition Commission as well because it is likely bringing economic devastation and hunger in the country which is our member State.
“We share our deep concern with Malawians, and ask all member States to individually support Malawi in this period of most need.”
Mwemba revealed that his organisation is mobilising more resources such as computers and education materials to help in the restoration of learning in affected schools.
Comesa Competition Commission is mandated to enforce the commission’s regulations to promote competition and enhance the welfare of consumers in common markets.