Executive director of the Consumers Association of Malawi (Cama), John Kapito, says Malawi will need a miracle to get out of the current economic doldrums if nothing serious is done to revive the economy.
Kapito made the remarks on Saturday when he was commenting on a Nation on Sunday survey on whether people believe the economy will improve in 2013.
The survey polled data from interviews conducted in 18 districts where an average of 50 people participated in each district.
Some of the responses were polled from our short message service line.
Out of 1 145 respondents, 805, representing 70 percent of the sample, said they do not see the economy improving in 2013.
“I don’t think the economy will recover from the doldrums that it is in because we are not generating enough exports and we are importing almost everything. The cost of borrowing money from the banks is high and that means fewer investments which in turn means less job creation,” said Kapito.
He poured cold water on the much touted Economic Recovery Plan (ERP), saying the blueprint is only on paper.
“I don’t think there is any ERP. An ERP is not a piece of paper; it is action on the ground which is not present in Malawi at the moment. You cannot run an economy by begging, which is the only thing we are doing at the moment. What would become of this country if donor inflows were cut off?
“They said the economy would improve in six months, but show me what has changed and the vital indicators such as inflation have only worsened,” said Kapito.
He said Malawi should seriously support local exporters who can generate the much-needed foreign currency.
Since the Joyce Banda administration devalued and floated the kwacha in May 2012, Malawians have had to live a precarious existence as commodity prices refuse to stabilise.
The liberalised foreign exchange policy has seen the kwacha trading at over K400 against the US dollar.
Inflation currently stands at about 35 percent while interest rates hover around 40 percent.
But even as the cost of living continues to soar in the country, government insists that things will pick up in the short to medium term.
Government has repeatedly described Banda’s one year in office as a success, citing a relatively stable fuel market as one of the President’s achievements.
Government spokesperson Moses Kunkuyu could not be reached for comment yesterday.
But Kunkuyu told Nation on Sunday when a similar survey was conducted in January that the situation would improve in the country because of the recovery plan.