One heck of a week

So much has happened this month. Reserve Bank of Malawi (RBM) Governor Charles Chuka decided to give Malawians his idea of an early Christmas gift: a K2 000 banknote that, while it will help you have a less bulky wallet, proves how, as a country, we have failed to progress with a respectable degree of success, in becoming an economy that is less dependent on cash payments.

Sure, mobile money transfer mechanisms such as TNM’s Mpamba and Airtel Malawi’s Airtel Money have helped the country move around billions of kwachas without carrying around too much cash; we remain very much a cash society.

Chuka’s decision also means two things that do not give comfort to the medium and long-term health of the economy.

By coming up with the K2 000 note the central bank is signaling that the inflation rate is unlikely to come down any time soon, let alone hit single digits as visualised.

In other words, the RBM is signaling that the cost of living is set to keep rising as the general climb in prices persists.

The decision also signals that the local unit, the Malawi kwacha, is very far away from stability—that it will keep depreciating for the foreseeable future.

For an import dependent economy like ours, the news can only mean parting away with more money to get that suit you have craved for; that fertiliser necessary for household food security; that fuel to keep you running around and those drugs that keep you healthy and alive.

Chuka’s new bill also means that investing on the stock market could be tricky as the weak kwacha and high inflation rate could gnaw at any gains made.

So that was about Chuka.

Now, President Peter Mutharika also made headlines of his own. Unlike most people, I thought the speech was brilliantly crafted and I was convinced that he had some very good policy, programme and project proposals that, if implemented, would be good for the economy.

The only quarrel I had with the President’s speech was that he had presented an expansive and expensive agenda without a clear pathway to financing it.

I was also disappointed that the President keeps pushing the blame for the poor economic performance on everyone, but himself instead of taking full responsibility. This is no longer Joyce Banda’s economy—it is Mutharika’s economy now and he has to provide leadership on how to dig the country out of the hole it finds itself in.

But blaming the fiscal crisis just on Cashgate—especially if his idea of Cashgate is just the six mad months from April to September 2013 during which at least K24 billion was looted out of public coffers—is unfortunate.

We know there was Cashgate under the Bakili Muluzi administration. Just look at the K187 million education scam.

There was proven Cashgate during the Bingu wa Mutharika led government that forms part of the initially pegged K577 billion now reduced to K236 billion suspected fraud. There is Cashgate still going on in the current Democratic Progressive Party regime. The obvious example is what is happening at Electricity Supply Corporation of Malawi (Escom) where everyone wants to burry a massive procurement scam in the region of K4 billion.

Even in the main civil service, there have been reported cases of fraud bordering on Cashgate, including the scandal at Ministry of Health where a lot of money was stolen and some officials are on suspension because of it.

What Mutharika should be telling us are the steps he has taken to eliminate fraud and corruption in the public sector and demonstrate that whatever systems he has put in place are working.

In that address, the President failed miserably to articulate the effectiveness of whatever measures his government claims to have executed.

But in the end, the President has to be commended for his efforts at being accountable to the people and explaining what his government is doing although he could do that much more effectively in Parliament by facing the representatives of the people—the legislators as the Republican Constitution demands—directly.

So far, he has avoided doing that and I think it is a missed opportunity to show courage in the face of adversity that he can face his detractors, stare them in the face, outline his agenda and answer any of their questions.

The President does not have to hide behind microphones and podiums surrounded by his hand clappers every time he faces the nation.