That Malawi is at a political crossroads is a no-brainer. The country faces significant political and economic challenges and uncertainties. It is experiencing hyperinflation.
For example, a 2-litre bottle of cooking oil which was selling at K13 000 six days ago, was K17 000 on Thursday in most shops. It may be K20 000 or more today. A 50-kilogramme bag of maize is going at a staggering K75 000 in some parts of the country. I am told the same is going at as much as K100 000 in other areas. No one knows what the prices of many commodities will be next week if nothing drastic happens.
Now, maize is just one thing. The prices of so many other commodities that people need on a daily basis are rising at the speed if lightning. That is the cause of the upheavals which President Lazarus Chakwera during his Question and Answer Time responded to on Wednesday this week. And that is the cause of the demonstrations and street upheavals the country has experienced the past three days in Lilongwe and Blantyre. Times are tough.
In his statement, Chakwera blamed Asian traders and an unnamed opposition political party for conniving to push up prices of commodities and make Malawians suffer. Well, I will not argue against him. Suffice to say that there will always be something to blame when things are not well.
One of the President’s immediate responses to the development is the firing of Sosten Gwengwe as Minister of Trade and Industry whom he replaced with Engineer Vitumbiko Mumba. So, Engineer Mumba who, during the past two months when he was Minister of Labour, shook up companies, for unfair labour practices, is one of the people tasked to reverse or stop the price rises. It is a gargantuan task. And I don’t envy him. But I know he will do his best. And I wish him nothing but the best in this tough job.
Of course, the Ministry of Trade and Industry is just one of several ministries that need to tick and not do things the usual way in the circumstances the country is in. The other very key ministry is Finance.
And so my expectation, therefore, and I think those of many other people, is that the 2025/2026 national budget will reflect many of the policy changes that President Chakwera and his Malawi Congress Party administration intend to achieve to arrest hyperinflation and restore people’s hopes. Minister of Finance and Economic Affairs Simplex Chithyola Banda presented this very important national blue print to save government and Malawians yesterday. But whether it lived up to people’s expectation is another kettle of fish altogether.
At the very minimum, people expect the tax regime to bring reprieve to the people. Increasing the tax-free band, removing Value Added Tax (VAT) from some commodities, increasing allocations for social protection, introducing policies that cushion companies and help them navigate through the difficult economic environment they are now sailing through are some of the measures government could take. Sadly some companies have already closed down or are downsizing. On the fiscal side, government should also introduce spending cuts by suspending unnecessary local and foreign travel. There is so much that government can do to save the situation. But whether this happens or not we are at the mercy of this regime which has put us in this difficult situation and seems to have no clue how to get out of it.
