Covid-19 impact Worsens—survey

Findings of the first Malawi High-Frequency Phone Survey Covid-19 show that the impact of the coronavirus pandemic is worsening livelihoods of Malawians with 96 percent considering it a crisis threatening their incomes.

The survey, being conducted by the National Statistical Office (NSO) on a monthly basis, is part of the World Bank-supported global effort to support countries in their data collection efforts to monitor the impact of Covid-19.

Reads in part the report: “Ten [10] percent of households needed medical treatment, but reported not being able to access it. Soap and cleaning supplies were reported as the most common items needed by households. Although most households were able to purchase the soap that they needed, 23 percent could not purchase cleaning supplies.

“While 51 percent of households needed to buy maize in the last seven days prior to the interview, 29 percent of these households could not do so, mainly due to high prices and lack of cash/credit.”

The report added that up to 94 percent of Malawians were worried about themselves or their immediate family members becoming seriously ill from Covid-19.

Similarly, 96 percent of the respondents said they considered the pandemic a crisis and a substantial or moderate threat to their households’ finances.

Reads the report: “The estimated incidence of being very worried about becoming seriously ill is high across the wealth distribution, despite the small gap between respondents living in households in the richest quintile [88 percent] versus those living in households in the poorest quintile [92 percent].

“Similar findings emerge in the cross-quintile comparisons of the estimated incidence of perceiving Covid-19 as a substantial threat to household finances.”

The threat to household finances comes into play more with the report indicating that most businesses, especially those run by families in rural areas, have plunged.

On employment, approximately nine percent of respondents said they had stopped working prior to the interview while 68 percent of workers in rural areas said they continued their usual economic activities compared to 73 percent of their urban counterparts.

“In urban areas, 88 percent of businesses in the services sector reported lower or no sales revenue. Similar widespread reported decreases in sales revenue of services sector businesses in rural areas,” reads the survey report.

The findings of the survey were in tandem with projections by Employers Consultative Association of Malawi (Ecam) which last week reported that 273 712 Malawians became jobless in the first half of 2020 due to the impact of the coronavirus pandemic. It estimated that by December, 680 496 jobs will be lost if the pandemic persists.

On the other hand, figures from the Malawi Confederation of Chambers of Commerce and Industry (MCCCI) show that prior to the pandemic in March, capacity utilisation for 52 percent of firms in the manufacturing sector stood between 50 percent and 75 percent.

But the chamber said at the end of June, the utilisation capacity had dropped to below 50 percent because firms were unable to import raw materials due to global travel restrictions instituted in the face of Covid-19.

With job losses and businesses facing challenges, the new survey indicates that the prevalence of severe food insecurity among the adult population is high, but more pronounced in rural areas.

The poor suffer most on education

The report details how children for the less-privileged and those in rural areas have been affected due to the pandemic, with closure of schools said to have caused a drastic reduction in access to learning and education.

Even in the wealthiest quintile, only 25 percent of households are participating in any type of learning activity and in the report, the comparable estimate is seven percent  of households in the bottom 20 percent of the pre-Covid 19 wealth quintile.

In terms of students having contact with their teachers, only six percent of households with school age children in urban areas and three percent in rural areas had any contact with their teachers.

Among these students, 27 percent communicated with their teachers through SMS, 14 percent by telephone, 33 percent via WhatsApp, 18 percent through online apps, and eight percent on Facebook messenger.

Government is pondering the reopening schools in early September, but an analysis last week showed that the exercise could cost the economy tens of billions of kwacha monthly if our calculations based on experts’ requirements are anything to go by.

Based on the requirements, our rough calculations showed that government will have to raise up to K15.117 billion monthly for allowances and face masks for both teachers and learners if schools reopen.

Government directed that schools should close on March 23 this year as a Covid-19 preventive measure. On April 2, Malawi registered its first three Covid-19 cases, which escalated to 5 382 by Saturday.

No protection for the poor

As Malawians continue to languish, government is yet to roll out the K38.9 billion six-month social cash transfer programme set to relieve vulnerable urban dwellers from Covid-19  effects.

Rafiq Hajat, a social commentator,  suggested a bottom-up approach, saying, much of the funds are used administratively, like for allowances, without  thinking about people on the ground.

He said: “It seems that most of the resources are being used for administrative purposes, very little is tricking down to the people who need it most.

“The cash transfer system has had limited impact. It has not reached the people who need it the most. We have a critical conundrum. I would say that 95 percent of all the resources that come into the country must go down to the people, and must clearly be accounted for, the rest can be used for administration.”

Earlier, Ministry of Economic Planning and Development director of poverty reduction and social protection Patricia Zimpita said what remained of the programme—which was scheduled to roll out in June—was approval of the targeting criteria.

She said: “We had to finalise some preparatory activities, especially targeting of beneficiaries as well as integrating Covid-19 prevention measures during implementation.”

In April, former president Peter Mutharika announced that the programme would target 172 000 households in urban areas with 80 178 in Lilongwe, 66 744 in Blantyre, 17 258 in Mzuzu and 8 703 in Zomba with K35 000 monthly stipends.

The programme is envisaged to target 35 percent of the urban population and its direct beneficiaries include people living in densely-populated peri-urban hotspot areas.

A rapid cost benefit analysis on the impact of Covid-19 done by the National Planning Commission showed that moderate movement and livelihood restrictions could generate $6.7 billion (about K4.9 trillion) in gross domestic product loss over the next 30 years.