It can’t be more of the same in 2012!

Honourable Folks, the verdict has been virtually unanimous; 2011 was the worst since the advent of multiparty dispensation in 1994.

It seems there is no debate on this issue as even the MPs from the government side, in their most honourable, patriotic and unflinching loyalty to the pragmatic and foresighted leadership of the Ngwazi, Professor Bingu wa Mutharika and his government, made a demand of nearly 300 percent pay rise in the last meeting of Parliament.

Reason: They could not make ends meet. The zero-deficit budget, which they had passed with much fan-fare mid last year, hit them below the belt just as hard as it hit the rest of us. Commodity prices are rising by the day despite the desperate efforts by the Mutharika administration to fix an arbitrarily high political pricetag to the kwacha, arguing that devaluation would hurt the poor.

To make matters worse, drugs, fuel, water, electricity and other essential goods are not only becoming more expensive but they are also scarce. An economy that was growing at over 7 percent for half a decade has, within seven months been brought down on its knees by a government whose new economic agenda is a cryptic puzzle even to our best economic minds!

Only Mutharika, praised as an economic engineer by his predecessor Bakili Muluzi, and some of those close to him, seem to see sense in the government policy despite the pain it has inflicted on us. Just between Christmas and New Year, the Ngwazi declared the kwacha won’t be devalued and challenged anyone working in his government who is for devaluation to tender their resignation letters!

They won’t! Rather, the challenge makes their job easier. They will sit and watch, enjoying trappings of their high offices while waiting for their day to laugh a good laugh. But the hard-working Malawians—the ultimate victims of political blunders by the Executive arm of government—don’t deserve the empty tough talk and confrontation.

In 2012, government must explain how our best economic interests are served by its policies. Since the kwacha was floated against the dollar around 1992, we have seen it going down from K4 to a dollar to the current position where the black market (probably real value of our currency) is between K230 and K270 to a dollar.

Of course, every devaluation brings with it pain as prices go up, but gradual devaluation brings bearable pain while, ensuring the availability of forex on the market.

I, for one, thought Mutharika would generally continue this way while doing what he promised us—transforming the economy from an importer/consumer to a producer/exporter. That way devaluation would have logically benefited exports.

But since this has not happened, holding on to an over-valued kwacha would only make us lose both ways—exports which we don’t have and imports which we can’t have unless our kwacha can buy foreign exchange.

By the way, aid inflows have been the second major source of forex for Malawi. Yet the Mutharika administration, in its wisdom, is determined to wean Malawi—which a couple of years ago hoisted a new flag with the overhead sun exuding white rays symbolising dawn is over—from it.

This is happening despite that even by official records, over 40 percent of the population still live in abject poverty and our economy remains precariously anchored by tobacco which nobody out there wants to smoke!

Mutharika is adamant to do without “their aid” because it comes with strings attached. He believes as an independent sovereign State, donors should give us aid the Chinese style without demanding good governance and respect for human rights from our government. Such demands, according to him, only serve to prove that aid is a characteristic of neocolonialism.

What the President does not say, though, is that aid and at least good economic governance, were key to the economic growth we have enjoyed in the past five years. We could have consolidated our gains by addressing our weak areas—political governance, corruption and violation of human rights—to render ourselves more attractive to donors whose aid has now become a very scarce commodity.

That could have enabled us to turn our dream of building Nsanje City around an inland port serving Malawi and two or three other landlocked countries a reality. It could also have enabled us to amass the resources to build our economy and add value to agricultural produce for export within the region and abroad.  Simply put, it was the only way to reduce poverty and grow the economy the Ghana way, not the Zimbabwe way.

 

 

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