Honourable Folks, thereâ€™s no denying that devaluation, floatation of the kwacha and other measures put in place to restore donor confidence in the economy are causing us a lot of pain. Thatâ€™s to be expected when you press a boil to remove puss.
The good thing from that painful experience is that it marks the beginning of a healing process.
The pain caused by the rising cost of living has, as expected, sparked off strikes. Employees, from university lecturers to seasonal workers, demand horrendous pay-hikes from their cash-dehydrated work-places.Â Ironically, on the political front, people blame the Joyce Banda government for it. They wonder why it went ahead to devalue the kwacha by 49 percent if the consequences are what we see.
Itâ€™s as if there was a better alternative! The late president Bingu wa Mutharika resisted calls to devalue the kwacha. He argued that devaluation would only trigger inflation which would hurt the poor in the villages most and when the donors put their foot down, he chose to go the zero-deficit budgeting way, instead.
We all saw that by maintaining an over-valued kwacha for long, the Mutharika regime did not necessarily contain inflation. Prices were benchmarked on the parallel market value of the kwacha which was 50 percent above the official rate.
Commodity prices kept on rising but so too was poverty as shortage of forex started crippling the economyâ€™s capacity to generate wealth. We entered an economic phase symbolically characterised by zigubu in which there was an acute shortage of goods needed for the generation of wealth to ensure economic growth such as drugs, fuel, raw materials and spare parts.
Had Mutharika allowed the kwacha to devalue gradually with time as some economists suggested, one poor tobacco season would not have caused the situation to be this volatile. Love or hate it, it remains a fact that donor aid, despite being cobwebbed in controversy and uncertainty, contributes a significant 30-40 % of the national budget and we cannot just wake up and ditch it.
What we should have been doing is diversifying our economy, arresting corruption and wastefulness and investing wisely in productive sectors while the window period of aid inflows remains open. This is prudence. What is stupid is planning to live on aid forever.
Unfortunately, the leader we elected made the grave mistake of rushing to bite the finger of the donor when the economy was not ready for his own kind of zero-deficit budget.Â The choice we had was to die or go back to the donors who had lost confidence in our economy, hence the need to comply with their demand for a 49% devaluation.
Understanding that when elected leaders make blunders itâ€™s the electorate that pays the price encourages the adoption of practices that minimize the exposure of the citizenry to consequences of bad governance.
Letâ€™s start from the first President Kamuzu Banda: he pretty much made all the key decisions on our behalf and assessed his own performance. All we did was sing and dance to songs in praise of his â€œwise, pragmatic, dynamic and foresighted leadership.â€ Outcome: he declared Malawi â€œa star performerâ€ yet when he stepped down in 1994 there was over 60% illiteracy, almost 80% of the population was in abject poverty, living on less than a dollar a day and Malawi had among the highest infant and maternal mortality rates in the world.
Â Then came Bakili Muluzi in 1994: He will probably be best remembered as a democratically elected President who â€œownedâ€ the ruling UDF, made it the other side of the so-called â€œpolitical government â€œ for which he was State President, and introduced leadership by prerogatives which enabled him to make decisions without having to account for them to anyone.
The outcome was that at the point of his exit in 2004, the economy was on its knees and, in terms of human development, Malawians were worse off than they had been in 1992! Yet, Muluzi rose on the promise that he would reduce and eventually eradicate poverty!
After Muluzi came Mutharika, the dictator in the skin of a democrat whose tragic story we have already shared above. Suffice it to say the fall of the economy preceded by a consistent economic growth of 7.5% average for six years!
The point I am making is this: for things to improve in Malawi, we should not expect an angel in the State House. Rather, itâ€™s us, the citizens, to ensure that whoever is thereâ€”angel or devilâ€”gives us a fair, not raw, deal.