Q3 of 2023/24 closes with K25.1bn surplus
The Malawi Government closed the third quarter (Q3) of the 2023/24 financial year with a surplus of K25.1 billion, figures from the Reserve Bank of Malawi (RBM) show.
The central bank said in its January 2024 issue of the Monetary Policy Report that the government revenues in Q3 stood at K1.05 trillion while expenditures stood at K1.02 trillion, resulting in a rare fiscal surplus.
The report reads: “During the previous quarter, government expenditures amounted to K790.3 billion while expenditures incurred during FY2022/23Q3 stood at K769.2 billion. Meanwhile, total revenues collected during FY2023/24 Q2 totalled K688.2 billion, while K539.1 billion was collected during FY2022/23Q3.”
Based on Business Review calculations using RBM data contained in the December 2023 issue of the Financial and Economic Review, the surplus was an improvement over the K295.8 billion recorded in Q2 and K263.8 billion recorded in Q1.
Economics Association of Malawi acting president Bertha Bangara-Chikadza in an interview commended the government for the improvement in the past two months but cautioned that the positive trend might not be sustainable in the long term.
But she expressed concern that the improved performance might have been because of budget underperformance, a development that would “mean that the government was building up expenditure arrears which will be paid up in the first quarter of 2024”.
Said Bangara-Chikadza: “But, it [may] also mean that the government reduced borrowing and spent less because of the monetary policy stance which was adopted by the RBM to tighten up monetary policy.”
In a separate interview, Dalitso Kubalasa, a former executive director of Malawi Economic Justice Network, said the trend shows that the government had a surplus for two months, but still owes people from the previous months.
He called for greater scrutiny on how the government is managing its resources in the long-term.
Based on the figures in the 2023/24 Mid-Year Budget Review Statement, the government expects to run a deficit of K1.27 trillion, representing 29.6 percent of total expenditures estimated at K4.33 trillion.
