President Lazarus Chakwera has blamed former presidents Peter Mutharika and late Bingu wa Mutharika for Malawi’s economic mess which he says he is now cleaning up by making painful corrections.
Chakwera, who was elected in 2020, spoke from Kamuzu Palace in Lilongwe yesterday following the 44 percent devaluation of the Malawi Kwacha.
When Bingu was in power, Malawi’s donors including the International Monetary Fund and the World Bank, cancelled the country’s international debts in 2006.
According to Chakwera, the fresh start Malawi was given under Bingu was put to good use for the next two years as Malawi’s economy began to rebound.
Chakwera, however, noted that these gains began to be lost after the 2009 presidential elections in which Bingu was re-elected by a massive landslide.
“People developed insatiable appetites for spending on consumption and neglecting to invest in production, including a presidential order to the banks to allow people to cash government cheques at commercial banks without any controls.
“The result was cashgate and the loss of international budgetary support we had received in 2006 which we have never gotten back, until now,” said Chakwera.
He added that his administration is correcting mistakes in economic management he had inherited after taking over from former President Peter Mutharika.
Chakwera claimed that he is cleaning up the mess which was created by other people and this clean-up involves making painful decisions such as devaluation of the Kwacha and implementation of reforms to regain donor confidence.
He said the support Malawi has regained under his administration include African Development Bank’s US$30 million for budgetary support and European Union’s 70 million Euros for budgetary support.
Malawi is also set to receive US$6 million from International Fund for Agriculture Development’s for projects in agriculture, World Bank’s US$60 million Trade Finance Facility and US$217 million as a response to fiscal reform.
Chakwera said these injections of millions of dollars will help enrich the local banks with forex and enable them to import strategic commodities.
He added that Malawi once again has an opportunity to put to good use the international confidence the country has regained.
“I know that there will be some who will want us to squander this opportunity by spending money. I will not allow that,” said Chakwera.
