Centre for Democracy and Economic Democracy Initiatives (CDEDI) has demanded President Lazarus Chakwera to provide an update on the status of forex in the country and present policies that have been put in place to end the forex crisis.
CDEDI Executive Director Sylvester Namiwa told journalists on Thursday during a press briefing that for the past two years under Chakwera, the business community has survived on the parallel market to access forex to run the economy.
He added that it is a mockery for the Reserve Bank of Malawi (RBM) to peg the United States dollar at MWK825 when, in fact, the authorities are aware that the green buck is not available in the first place and wherever it is found, the rate is pegged at more than MWK1,150.
“It is sad that government is exerting negative energy by blaming everyone and everything from the Covid-19 pandemic to the war in Ukraine and not its poor leadership for the skyrocketing cost of living, thereby conveniently forgetting that Malawi is a predominantly importing and consuming nation, hence any rate of fall of the kwacha means more misery for the people,” he said.
He added that president should come up with mechanisms that will resuscitate the country’s economy from its death bed.
Namiwa noted that the country’s economic status is heading south as evidenced by the rationing of essential goods and services, scaling down of local production due to scarcity of foreign currency, the ever-weakening Malawi
kwacha and increasing electricity loadshedding hours.
Namiwa observed that the dire economic outlook is dampening the spirits and aspirations of Malawians each and every passing day with headlines clearly pointing to a clueless and helpless leadership.
“Just to cite a few examples, CDEDI has learnt with shock revelations that this month the country has only managed to secure forex just enough to procure essential drugs and medicines for 20 days, production in most of local industries is at zero, essential commodities such as cooking oil and sugar are being rationed in shops, reputable airlines have scaled down their services in the country due to unavailability of forex and businesses have grounded to a halt due to the unavailability of forex,” said Namiwa.
With the prevailing trends, Namiwa has observed that Malawi will soon begin to needlessly lose productive lives to preventable diseases due to lack of drugs and medicines in both the public and private health facilities.
He said they are of the view that the current government erred big time by cancelling the International Monetary Fund (IMF) Extended Credit Facility (ECF).
“As they say bad politics makes bad economics, apparently, we have established that such a costly decision was made to accommodate their litany of campaign promises such as the Affordable Inputs Programme (AIP), the duty-free week, not forgetting the globetrotting by President Chakwera and his Cabinet. Such extravagance would have certainly have put the IMF programme off track, hence the cancellation,” he narrates.
Namiwa then claimed that involvement of government’s high-ranking officials in forex externalisation, non-trickling of proceeds from the sales of agricultural commodities on the international market such as South Sudan and India and Chakwera’s own cluelessness in running State affairs, are some of the reasons that have pushed the country’s economy into the ditch.
“With President Chakwera’s tendency of shielding corruption, it is not automatic that Malawi will get the IMF nod. He should not put all the eggs in one basket by banking all his hopes on the IMF, which by the way is not a charitable organisation. This therefore, calls for plan ‘B’,” says Namiwa.
He further urged government to plan and act for a future that must be defined saying as it stands now, Malawi is on autopilot and, unfortunately, the captain is in deep slumber.
