Malawians should brace for rough ride – Economists

Economic analysts have warned that Malawians should brace for hard times in fending for basic goods and services because government’s failure to meet International Monetary Fund (IMF) targets and that most Malawians will not afford to purchase basic items by December 2015.

Prof. Ben Kalua: Tough times ahead for Malawians

Prof. Ben Kalua: Tough times ahead for Malawians

IMF has suspended loans to Malawi for failing to cut its wage bill and improve revenue collection, making it less likely Western donors will resume budgetary aid.

According to published reports, the University of Malawi’s economics professor Ben Kaluwa feels the current economic situation, as assessed by the IMF, will culminate into worsening donors’ confidence and further frustrate both foreign and local investors as there is a gloomy economic outlook.

Budget assistance from Western donors worth millions of dollars has been withheld for two years now —amid concerns of Cashgate, the plunder of public funds at Capital Hill— . Such aid has historically accounted for about 40 percent of the national budget.

The IMF said the loan facility would remain suspended until Malawi’s government met certain targets.

Kalua, who is based at Chancellor College in Zomba, feared that the situation will likely lead to rising lending rates in banks hence denying businesses the much-needed capital to expand their business ventures.

“Malawi has well-trained economists, but government has not allowed them to do their professional work. On varied reasons, government has tended to disregard the advice of economists; and this is the major challenge and stumbling to the growth of our economy,” Kalua is quoted by The Nation newspaper.

Kalua argued that government overspending has essentially piled up inflationary pressure on the market.

He projected that come December “most poor Malawians would not afford to buy even a packet of sugar if the economic situation remains as it is.”

Centre for Social Concern (CfSC) economic governance expert Mathias Kafunda told the paper that the urban population, which largely depends on commercial goods and services, will be severely affected in the short to medium-term.

“If inflation continues to increase at an increasing rate, then the situation will negatively impact on the pockets of the urban poor whose income remain static,” he said.

Inflation—the rate at which prices of goods and services change— is at 22.2 percent.

Prices of basic goods such as cooking oil, sugar and maize, among others, have jumped up to the sky in recent months mainly on account of a weakening of the local currency beginning end June this year as importers and traders are passing on the high cost of importing to consumers.

Minister of Finance, Economic Planning and Development Goodall Gondwe also admits that the economy is currently in “a critical point”.

He has bassured the IMF on Wednesday that government is geared to improve business environment and the macroeconomic situation in general.

Gondwe said he is “ absolutely confident “that at the end Malawi will end up with a robust and positive growth.

The IMF said on Wednesday that Malawi’s economic growth would slow to 3 percent this year from 5 percent in 2014, reflecting a decline in the maize harvest and weak private- sector investment and consumption.

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34 thoughts on “Malawians should brace for rough ride – Economists”

  1. Pete Nyandoro says:

    We were told by this old man that come December Malawians will clap hands. is this what he meant?

  2. wosauka says:

    Malawians are still in abject poverty.The so called economic growth is mere rhetoric.Those at the hem continue plandering resources at the expence of the poor.

  3. ngulenjet says:

    Kkkkkkkk what a fool of a person is kuchanco what wrong has kalua said? Bingu is a failure and those that voted for him and those that helped him steal the elections plus kenyata are all to blame for all this suffering Kuba anayamba ndiwo mu 2009

  4. learnedmi says:

    MALAWI ECONOMY WILL NOT IMPROVE BECAUSE WE DELIBERATELY IGNORE THE AREAS CONSUMING OUR SCARCE RESOURCES. IF WE ARE COMPLAINING ABOUT 115 DELEGATES WHY ARE NOT COMPLAINING ABOUT THE NUMBER OF MEMBERS OF PARLIAMENT? WAGE BILL IS WHAT IS CONSUMING ALL OUR TAXES. CIVIL SERVANTS ALWAYS DEMANDING A RAISE BACKED BY POLITICIANS. ALL FROM OUR TAXES.THEY ARE NOT CONTRIBUTING ANYTHING TO THE ECONOMY. THE FIGURES ARE THERE FOR ALL TO SEE BUT WE DELIBERATELY TURN A BLIND EYE.MARK MY WORDS “THE NEXT SITTING OF PARLIAMENT, MPS WILL RAISE THEIR PERKS”

  5. Sailota says:

    I have no reason whatsoever to feel sorry of Malawians. Nzofuna izi. Munya!!!!!! Simunati. Mudya chimanga cha pa nsalu chaka chake ndi chino.

  6. cbk says:

    dadaboma is right,people voted by tribe.they didn’t want also female president.

  7. MSANA WA PETURO says:

    I think some of you people are so stupid and can’t jst get facts. The professor has clearly stated that gvt does not take economists’ advice. What do you expect them to do after this when your stupid gvt and president can’t listen? Rubbish!!!

  8. Mpumulo aw Bata says:

    Wake me when it’s time to “clap hands “for this good for nothing administration. …….. Whenever that is..

  9. Zachisone says:

    Kodi Joice Banda wabwela? Abweze ndalama ameneyo. Peter bvutoli walipeza. Ndipo akuyesetsa kuti zinthu ziyende. Ndipo ziyenda. Inunomwe mukumunyoza mudzachita manyazi. KODI AKALUAWO AMADWALA THENDA YA MASO. KAPENA BOOZE ALLERGY. kKKKKKKKKKKKKK

  10. akupha says:

    University lectures and professors need to cut their salaries and benefits as well. Yes they are supposed to do research and advise Gov way forward. But what do they do. DRINKING basi. Tamuwonani maso ali psyuuuu. Kuchita kudziwika kuti thonjani wamupweteka. That is why students at Chancellor college are always drunk. Following the leaders (Lectures and professors). ADVISE GOV WHAT TO DO NEXT. Prof. in Economics. Za ziiii. . Tchito kunyenga ana a school basi for grades.

  11. dadaboma says:

    Mavutowa ndofuna aMalawi. Why on earth could any sensible person vote for DPP? Those who did this silly mistake killed Malawi. This country is finished. There was an able leader by name of JB. She was incensed that civil servants in govt were stealing money and she did not hide it like stupid Bingu did earlier. JB revealed the scam and embarked immediately on corrective measures to restore fiscal prudence. And then stupid Malawians interrupted JB by voting her out of office just because her policies accommodated the north, she was married to a northerner and had a northern VP. Ali JB waba ndalama, poti waulula okuba ndalama. Bulshit. What is this now? This country will only resurrect when JB comes back to rule it, not otherwise. If you still can’t see this truth, then prepare yourself for more tough times until you’re squeezed to death.

  12. Jones Kanyundo says:

    We learn through mistakes,i ithink world bank could change its mind and see how the Government will run its affairs than just holding the support.World must know that they are punishing apoor malawian not our leaders.Our leaders are enjoying amid economic difficulties,they have got all the possibilities,shame!!!

  13. kuchanco says:

    This kalua is a massive drunk … U will see him loitering and pissing all around town every evening especially around PUMA and maneb in Zomba. He may be found out of his car coz he fails to drive … He stands on the road with his stupid antics…. How reliable are these bastards ? Just talking and no action?? Stop relying on this old fish and start an effective and practical approach!!!

  14. Mhesha says:

    When did IMF policies work positively for African economies? These guys keep on changing goal posts such that one cannot make progress. They know the country is lacking budgetary support and they are keeping on pressing on it. How should one find space in that situation? Let them stay out and away from us…

  15. Anthu ena nzisirudi a Malawi changamukani NAC, has brought a lot of sadness to most malawian in one another and DPP is still continuing miss using taxes and you think you can develop

  16. The main problem donors knows that cashgater is the same DPP so as long as DPP is there they will never resume any donor funding. Malawians are going to pay for your sin

  17. Sambaukwatiwe says:

    I thought the economists could advise the gvt on how to handle the situations, but instead they are just issuing warning threats, this wont help, provide the solutions aswel pls

  18. pacheco says:

    Economists do not create wealth. they just produce papers to generate consulting monies. period. otherwise totally useless people. IMF is run by economists who would die of poverty if fired from their jobs because they don’t know how to independently create wealth if left on their own. totally irrelevant people. how many Asians, Indians, Chinese, Malaysians do you see running around claiming to be doctoral holders??? none. they are busy starting businesses and thus creating jobs, opportunities and wealth for their nations! but look at Malawians- all waiting for free fertilizer, malata, allowances and pure theft of public resources. the civil service is what Jesus called ” a den of thieves”!!! plundering with impunity! politicians and MPs robbing us blind with their huge salaries, fuel allowances, political loans and fake foreign travel for nothing!! may they all rot in Hell!!

  19. black moze says:

    Everyone is asking you university lecturers in Malawi to conduct a research that would take Malawi out of these dilemmas. Yet you are busy issuing warnings to us people in the rural areas. Why are doing that? Mukungiranji zimenezo. You are not interested to be associated with problems in Malawi. Why university lecturers in Malawi do degrade themselves to the level of primary school teachers?

  20. Jimbo says:

    Those who are supposed to be running the country and managing its resources have PHDs in ‘Corruption’. They care nothing for the plight of the common citizen. No.4’s comment is utterly stupid. The kwacha is worth nothing outside Malawi. The country needs forex in order to purchase what it needs from abroad. Most manufactured goods have to be imported and paid for in dollars, pounds or euros. Meanwhile all the delegates in New York are busy spending the country’s forex on their own personal luxuries. If that is not corruption in practice, I don’t know what is.

  21. chisomo says:

    God will open a door for Malawi. IMF is not God. They give us aid and encourage homosexuality in the guise of human rights. To hell with their money.

  22. msumbo rsa says:

    Pitala nkhope ngati maliro chimunthu chosaphunzila umbuli ulitho kukamwakwako

  23. Kandapako says:

    We Malawians are very resilient, we shall survive….akhala umphawi ndi kannansi. Njala ndi ija timaimba tsiku ndi tsiku mu Nyimbo Ya Pfuko. Pagonanji apa!!

  24. Mlakho says:

    Zonsezi ndi Mbendera judge wolira.

  25. KK says:

    Madala awa akuwoneka ngati a mamwa kwambili. Khope ngat phulusa. Oooooo by the way he is Tumbuka.Kikikiki

    1. MSANA WA PETURO says:

      Bola Mtumbuka ameneyu ndiokongola kusiyana ndi Mlomwe Chaponda and toothless nyansi yanuyo.

  26. Saiziyakana says:

    Economic management of this country is lacking – the savages that are said to be our leaders makes it almost impossible for a sane analysis at any point. This economy is slowly grinding to a halt – but if you say this to the Kaliatis, Chapondas, Dausis they will say you are deliberately sabotaging or tarnishing the good image of DPP. The thieves can not link their Public Funds plunder and the state of the economy and they do not even care as they do not get affected. The more the economy suffers the more they steal from public funds to cushion their insatiable financial appetite.

    Winning votes is not a licence to plunder public funds. Anthu akumizi akumangowanamiza with smokescreens, lies and stupid promises. They have now realised that anthu ambiri ayamba kupenya – hence introduction of school fees etc to maintain the status quo i.e. anthu asamphunzire kwambiri otherwise awatulukira. DPP does not stop to amaze me regarding its dark manipulative scheemings – at the expense of everything else.

    The way the commission and the electoral laws are – forget about anyone else winning no matter what. Mafioso at work – Kalonga and Mbendera will not allow reform or change for their own good.

    What then? your guess is as good as mine.

  27. chimwemwe says:

    Abale, IMF take my word no matter what we do they will never assist, i have also noted that whenever IMF missions are headed by a fellow african they are even more tough and ridgid then the Mzungus, so lets just accept they are like a picture frame which will never move or act.

  28. becks says:

    Mbuzi

  29. Parallel Market says:

    We have never had a smooth ride economically in Malawi. Which tough ride are you insinuating?Tough ride nonsense!! Economists again. Always creating a mountain on an anti-hill.

  30. mlomwe original says:

    let them keep their monies, we have our kwacha here

  31. lassel says:

    Tazolowera. Only God can deliver us. Not extravagant IBU

  32. chimutuwaka says:

    can we sale the house sitting vacant at ndata farm and the buses in are 30 and probably invite Joyce Banda to gv back whatever amount she owe us Malawians for our survival. this is unprecedented and we cant withstand the pressure ahead of us we are too fragile…iwe pitala uzibwerakonso kumeneko ndi chigulu chakocho atleast to save something..itd high tym we react

  33. mapapaya says:

    Mmene mwaba ndalama mboma ndiye muziti Pitala sathana ndi mavuto a ku malawi. Akulephera.

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