Try harder on looting!

Honourable Folks, there’s no denying that winnowing ourselves from donor dependence is the desirable goal we must aim for. Every progressive developing country aspires for trade and attracting foreign investment—not aid.

Yet aid is very much a reality for many countries in Africa, including our neighbours—Mozambique, Tanzania and Zambia—which are attracting many more investors and whose economies are growing much faster than Malawi.

Why is it so? Despite its loopholes—and they are many, including the fact that no country has ever been pushed out of abject poverty by aid alone—donor aid still remains a tested necessary push for the take off of poor economies. Without it, even the capacity to earn forex and produce products for sale is greatly diminished.

In Malawi, former president Bingu wa Mutharika experimented with the zero deficit budget in 2011 after donors walked out on us. The outcome of that experiment was a flop with dire consequences on the economy which slumped to 1.8 percent from an impressive growth of 7.5 percent almost instantly.

Government realised it had even lost the muscle to raise projected domestic revenue and shamefully started doctoring figures to save face and political careers. Companies were closing by the day as forex for fuel, raw materials and spares for machinery became as scarce as a comet.

Today donors have abandoned us again when economic growth rate is at 5 percent which, experts say, isn’t good enough for population estimated at 15 million and growing at almost 3 percent annually. Unless our economy consistently grows at above 6 percent, we can only be sharing poverty not wealth.

If we factor in the fact that the wealth distribution of Malawi is so skewed that probably 90 percent of it goes to only 10 percent of the population, then it goes without saying that the majority who feed on straw will wallow is deeper poverty while their plight is buried in aggregated statistics and political rhetoric.

The media, as a messenger, has dutifully reported on the warning shots from Treasury and donors that there may be very little, if any, budgetary support in the 2014/15 due to the looting of public funds that came to light last year dubbed Cashgate.

Donors want the culprits identified, tried and punished according to the law. They also want government to patch up the gaping holes on its coffers before they can resume direct budgetary support.

My take is that, save for the ease with which donors can walk out on government, their demands aren’t any different from what the business captains and those of us who suffer monthly deductions of up to 30 percent of our monthly incomes plus 16.5 percent VAT (value added tax) want.

I’d like to believe that if it were not for the fact that as citizens we’ve a statutory obligation to contribute government revenue through tax, we too would’ve walked out on a government which snores while billions of out tax-money are being siphoned into dirty back pockets of crooks in the public and private sectors.

It’s only prudent that government stops taking us for granted and work extremely hard to restore our confidence in its ability to manage public finances properly. Otherwise, the Constitution allows for the right to demonstrate.

Government needs to assure not only donors, but more so its own citizens who cough up 60 percent of its revenue, that there’s in place a net with “finer mesh” to prevent Cashgate or fraud or corruption from draining its revenue. It also needs to show capacity to use tax-payer’s money effectively for the intended purpose as approved by Parliament.

Nothing in our laughable situation justifies the suicidal option of abandoning aid so we can go it alone as some people are suggesting. It did not work in 2011. It did not work for Zimbabwe—a much stronger economy—when President Robert Mugabe decided to stand up to Western donors.

It just can’t work for our economy where social welfare requires that we raise enough to give free education, free medical care and free or universally subsidised fertiliser (that’s what came out clearly during the presidential candidate debate on Tuesday) to a population 15 million, less than a million of which pays income tax.

If by freezing budgetary support by just months our government is virtually broke, what if the donors withheld their support for two or three years! Let’s experiment with zero-deficit budgeting when we become a middle income economy as envisaged in our Vision 2020!