The Catholic Commission for Justice and Peace (CCJP) has warned that Malawi is in danger of accepting the foreign exchange crisis as a permanent feature of national life, saying the shortage of dollars continues to quietly deepen economic hardship for ordinary citizens and businesses.
In a statement released Friday, the commission said despite efforts by authorities to address the crisis, the measures taken so far have failed to tackle the structural problems driving the shortage of foreign currency.
CCJP said the prolonged forex crisis has evolved beyond an economic concern and is now affecting the daily lives of Malawians through disrupted supply chains, and prompted rising costs of goods and services.
“As witnessed, the challenge has continued to disrupt supply chains, delayed payments to international suppliers and caused shortages of essential goods and fuel,” CCJP said.
The commission observed that critically low foreign exchange reserves and persistent trade imbalances continue to place pressure on the economy, while the growth of the parallel market has further weakened confidence in formal financial systems.
According to CCJP, exchange controls and difficulties accessing foreign currency through official channels have encouraged hoarding and illegal trading of dollars, creating a fragile and distorted market that benefits a few while hurting the broader economy.
“The growing mistrust in the formal system, reinforced by exchange controls, has encouraged hoarding and informal trading of hard currency through the ‘blackmarket’,” the Commission noted.
The organization warned that the longer the situation persists, the greater the risk that citizens and businesses will begin treating forex shortages as a normal reality rather than a national emergency requiring urgent action.
While acknowledging ongoing government efforts, including alternative export initiatives and engagement with development partners, the commission said these interventions have yet to resolve the underlying causes of the crisis.
CCJP has since called on relevant government ministries to intensify the fight against illegal forex trading while implementing long-term solutions aimed at increasing foreign currency inflows and restoring confidence in the formal market.
“The Reserve Bank, Ministry of Finance and Economic Planning and Minister of Industrialization, Business, Trade and Tourism should strengthen measures aimed at curbing illegal foreign exchange trading while addressing the structural causes of forex shortages,” the Commission said.
In a statement released Friday, the commission said despite efforts by authorities to address the crisis, the measures taken so far have failed to tackle the structural problems driving the shortage of foreign currency.
CCJP said the prolonged forex crisis has evolved beyond an economic concern and is now affecting the daily lives of Malawians through disrupted supply chains, and prompted rising costs of goods and services.
“As witnessed, the challenge has continued to disrupt supply chains, delayed payments to international suppliers and caused shortages of essential goods and fuel,” CCJP said.
The commission observed that critically low foreign exchange reserves and persistent trade imbalances continue to place pressure on the economy, while the growth of the parallel market has further weakened confidence in formal financial systems.
According to CCJP, exchange controls and difficulties accessing foreign currency through official channels have encouraged hoarding and illegal trading of dollars, creating a fragile and distorted market that benefits a few while hurting the broader economy.
“The growing mistrust in the formal system, reinforced by exchange controls, has encouraged hoarding and informal trading of hard currency through the ‘blackmarket’,” the Commission noted.
The organization warned that the longer the situation persists, the greater the risk that citizens and businesses will begin treating forex shortages as a normal reality rather than a national emergency requiring urgent action.
While acknowledging ongoing government efforts, including alternative export initiatives and engagement with development partners, the commission said these interventions have yet to resolve the underlying causes of the crisis.
CCJP has since called on relevant government ministries to intensify the fight against illegal forex trading while implementing long-term solutions aimed at increasing foreign currency inflows and restoring confidence in the formal market.
“The Reserve Bank, Ministry of Finance and Economic Planning and Minister of Industrialization, Business, Trade and Tourism should strengthen measures aimed at curbing illegal foreign exchange trading while addressing the structural causes of forex shortages,” the Commission said.
