Norway still maintain aid support to Malawi: Envoy says cashgate not worse than third term bid or July 20 killings

Norway has said it has not withheld its financial aid to Malawi following  swindling of billions of Malawi Kwacha from state coffers in what has been dubbed the Capital Hill cash-gate scandal, named after the seat of government and commended the steps by government in probing the saga.

Norwegian ambassador to Malawi Asbjorn Eidhammer has argued that the cashgate is not as bad as the bid by former president Bakili Muluzi to longate his stay in power  dubbed ‘third term’ and the tragic events in 2011 where 20 people were killed in anti-government riots under late Bingu wa Mutharika.

He said in the cashgate saga, political and civic rights are not at stake and that the economic policies are still sound.

In September the budget director in the finance ministry survived an assassination attempt on the eve of revealing the government corruption ring.

Asbjorn Eidhammer: Norway support not cut

Asbjorn Eidhammer: Norway support not cut

Since the scandal emerged donors have suspended aid, calling on government to rapidly deal with rampant corruption.

Malawi relies on foreign aid to bankroll around 40 percent of its national budget.

But in his analysis published in the local press, Eidhammer noted that  in cashgate, it is only confidence in the government’s budget system and financial management that is lost.

“In this situation there is reason to commend the leadership for its commitment to investigate and get to the bottom of these issues, not least in inviting a considerable number of international auditors and investigators. I trust the momentum thus created will be upheld. Anything else could prove to be disastrous,” argues Eidhammer.

He further argues: “Before the elections in 2004 the ruling party prevented others from having meetings and sent its youth to invade newspaper offices, while there was constant spending in the Office of the President. It was difficult to support the government’s budget in such a situation. As it was in 2011, when the economic policies were self-defeating. In the present situation, different though it may be, the looting of government coffers prevents us from giving budget support. But it does not mean we take our money and run away, as various cartoons have vividly described.”

Eidhammer says during the most turbulent times under the previous president, donors maintained their support although they used other channels and means to reach Malawians.

The ambassador says when the new government came in last year, donors supported its economic reforms which were harsh but necessary for Malawians.

“The results of those economic measures are easy to see today, and the signs of recovery are clear. Just ask the tourism industry. The tax income exceeds planned figures is also a good indication,” says Eidhammer.

Eidhammer further says that while Norway practices zero tolerance on corruption, it could not relate to mere rumours on cashgate.

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