Senior Cabinet Ministers yesterday scrambled to calm vendors who took to the streets in Lilongwe to protest rising prices of merchandise.
The vendors, particularly those dealing in second-hand clothing (locally called kaunjika), held demonstrations from Lilongwe Old Town, through City Centre to Parliament Building, where they met a team of government officials to present their grievances.
Top among their concerns was the high cost of goods, especially bales of used clothes, for which they demanded that government should provide tangible solutions to help save their businesses and livelihoods.
When the kaunjika traders arrived at the august House, three senior Cabinet ministers—Richard Chimwendo Banda of Local Government, Unity and Culture; Sosten Gwengwe of Trade and Moses Kunkuyu of Information—came out to assure them that government would look into their grievances.
During their speeches, Chimwendo Banda pledged that government would help to make foreign currency available to kaunjika importers to ease the high cost of importations that come with the shortage of forex while Gwengwe said his ministry had revoked all business licences for kaunjika wholesalers and retailers who will now be required to reapply, among other measures.
But the demonstrations by the kaunjika sellers are just a microcosm of the struggles that the general Malawian populace is enduring in their import-dependent economy.
The country is panting under a galloping cost of living that is too fast for people’s earnings and a crippling business operating environment that has forced some firms to close, others to downsize or suspend production or send warnings of imminent demise.
Households are even in greater pain.
The average monthly cost of living for a family of six surged 6.3 percent from K578 843 in November to K615 138—nearly seven times the K90 000 minimum wage—in December last year largely driven by a spike in food prices, according to the Centre for Social Concern (CfSC), leaving households, especially the poorest, barely surviving.
Given that the price of maize—the staple diet and a crucial raw material for several products—has increased by around 67 percent from roughly K60 000 in December to around K100 000 today, the cost of living has likely followed suit going by CfSC’s data.
At the core of the recent price spikes are foreign exchange shortages that have sent the Malawi kwacha tumbling on the black market where forex for imports is available at a steep rate of K5 000 per United States dollar while the official market run by authorized dealer banks, trading the dollar at K1 751 under the watchful eye of the Reserve Bank of Malawi, has no hard currency to sell.
For decades, Malawi has struggled to build a pre-dominantly exporting country and is currently only able to export goods worth around $1 billion against imports of $3 billion.
In fact, the forex the country brings from exports can barely meet the annual import bills of two commodities—fuel and fertiliser—leaving the fate of the rest largely to foreign donor inflows, which come either directly to government or through non-governmental organisations.
Addressing the vendors at Parliament, Gwengwe admitted that there is a forex crisis worsening the prices of goods on the local market.
He said government is stepping in to provide forex for importers with the expectation that they, in turn, will reduce prices of their commodities for the benefit of Malawians.
To this end, the minister said government has come up with a list of essential commodities that need to be allocated forex, with second-hand clothes
Importers who trade in maize flour, chicken feed, and baking flour will also benefit from the arrangement.
Gwengwe said: “Government’s order is that the prices should revert back to December. They cannot say no because it is the government that has made the decision.
“As of now, they do not have licences. Considering that they will be accessing the dollar at the official exchange rate, there is no businessperson in Malawi who cannot take that offer.”
Describing it as a very good and lucrative offer, the minister went on to say that: “Instead of buying the dollar at K5 000 you are getting it at K1 700, who can say no to that?”
Taking his turn, Minister of Local Government Richard Chimwendo Banda assured vendors that government is aware that Malawians are going through challenges.
He said: “The President knows there are demonstrations, and he is not sitting back. That is why he has sent his ministers to listen to you, and solutions must be offered.”
Second-Hand Clothes Vendors chairperson Lyson Chinunga urged government to act on the matter with speed.
Another vendor’s chairperson Steve Magombo said as of December 2024, a bale of children’s clothing fetched K800 000, but it now attracts over K1.4 million; women’s dresses cost K500 000, but are now at over K800 000, while shoes have risen to K210 000 from K120 000 in December.
