‘MPs must scrutinise IMF deals’
Recently, President Lazarus Chakwera and Minister of Finance and Economic Affairs Simplex Chithyola-Banda announced austerity measures to lessen the biting impact of the 44 percent kwacha devaluation, a prerequisite for the Extended Credit Facility (ECF) from the International Monetary Fund (IMF). Are the newly-proclaimed policy shifts enough to cushion the nation in agony? Is the government accountable to the IMF or Malawians? Our Features Editor JAMES CHAVULA takes the big questions to Centre for Social Accountability and Transparency (Csat) executive director WILLY KAMBWANDIRA.
As campaigners for transparency and accountability, how does Csat rate government’s handling of the devaluation?
Not convincing. The measures that have been put in place to cushion Malawians from the harsh effects of the devaluation are just desperate political gimmicks for the government to look like they have put measures in place to make lives better. These measures have no economic consequence in terms of dealing with the effects of the 44 percent devaluation of the kwacha.
Are you satisfied with the announced austerity measures?
Generally, we are not satisfied. The austerity measures are of no economic significance, especially knowing very well that those in power will be violating them very soon as they have done before. Sadly, the President has been in the forefront violating rules set by himself, and we are not surprised to learn that government ministries, departments and agencies are not implementing the new austerity measures, especially travel bans. This does not give us confidence.
The government has made no secret that the devaluation was necessitated by the push for the IMF’s Extended Credit Facility. Should our governors really be prioritising the IMF and other donors over the will and well-being of its people?
It is very unfortunate that these IMF negotiations and meetings are habitually conducted in closed doors and appear to be a reserve for the executive only. It is our wish that similar engagements and deals should be properly debated in Parliament. Our Parliament should be allowed to participate. Our concern is that as long as these engagements are strictly held between the IMF and the executive, they will always fall short of the interests of Malawians. Our great concern is that in their current setup, these deals appear unaccountable and we are not surprised that in other countries people are beginning to feel short-changed. The IMF negotiations appear to put our Parliament in a very obdurate position as the lawmakers are left with no option but to rubber stamp what the Executive has agreed. This is not democratic and does not prioritise the well-being of Malawians.
What do Malawians stand to lose if the Chakwera administration continues to toe the line of the Bretton Woods institutions at the expense of their aspirations and well-being?
It is important for us as a country to find solutions to prevailing economic challenges. No one will grow this economy for us. We need to fight corruption and abuse of public resources genuinely and correctively. If we don’t do this, we will end up losing our limited resources and hard-earned sovereignty and independence. Unless we achieve economic independence, we will just be dancing to the tunes of multilateral institutions even over marketing opportunities. Parliament has to pay more attention and scrutiny to these deals and agreements, not just rubber stamping them. The top-down policies should be adopted on the basis of economic merits, not just political ends. Again, institutions like the IMF and World Bank should use their power and purse strings to stop corruption. They should help us pass basic transparency and anti-corruption laws as part of bailout negotiations.
How can the government, which so requires the financial injections and endorsement of the Washington-based global economic captains, balance the good of its citizens and stay the course in implementing IMF-prescribed economic reforms?
If you consider the suffering Malawians are enduring, it is crucial for the government and the IMF not to avoid Parliament and civil society organisations and just to choose to work with the Executive whose engagements are not transparent and accountable. It is crucial that the interests of citizens are a central focus as these negotiations involve financial support, policy reforms or structural adjustments that can significantly impact the lives of citizens. Let there be open dialogue, transparency and inclusivity in these negotiations. The IMF must strike a balance between economic stability and social welfare ultimately benefiting people affected by these agreements.
How can Parliament keep the government in check so that it does not divert from Malawians’ aspirations, well-being and the austerities it prescribes for the citizenry?
It must pay more attention to these deals on the basis of economic merit, not politics. Otherwise, the current setup puts Parliament in an awkward position to provide checks and balances in the implementation of austerity measures. Parliament is reduced to rubber stamping decisions that the Executive and IMF negotiators make in closed-door meetings. The role of Parliament is to oversee the implementation of austerity measures regardless of their political affiliations.n
