Ecama talks of devaluation effects
Ecama executive director Buxton Kayuni, in an email response, said devaluation has to be done for a period of three to five years to cushion its impact.
He advised that any resistance to devalue the kwacha would hurt the economy further.
He said employees should understand the situation and not press for unrealistic salary adjustments.
“Remember, devaluation will make imports expensive compared to exports. Since most businesses rely on imported materials for production, most likely the resultant incremental costs will have to be shared with customers.
“The snowball effects are obvious here. Employees should understand that there will be a lot of transitional implications which definitely affect them as well. Pressing for better salaries by employees at this point will be very insensitive and a sign of immaturity
“The economy will recover, but not too soon as expected. During economic recessions like we are in, it is important to accept that just having a job is more important than fighting with an employer for unreasonable salary increments,” said Kayuni.
He asked government to remove the zero-deficit budget to ease pressure on Malawians, saying the budget was an experiment and that it is high time it was erased from people’s memory.
“It has brought untold miseries to us employers. It looked as if government was solely relying on employers to fund their activities, including paying salaries. This must stop,” said Kayuni.
Meanwhile, small timber traders have also called for a tax review, saying taxes in the zero-deficit budget were exploitative.
Timber traders, Anthony Kitha and Adams Ngulume, said it is unreasonable to pay export duty K505 000 (about $3 000) on every 24 tonnes when they also pay duty where they are also charged duty in countries where the timber is going.
