Tackle ‘cost of living crisis’ – Malawi govt told

Life is becoming tougher by the day for ordinary Malawians in the face of escalating prices of essential goods and services and economics have urged the Peter Mutharika administration to deal with the rising cost of living.

Prof. Ben Kalua: Rising living costs are hitting Malawians  harder, especially the poor

Prof. Ben Kalua: Rising living costs are hitting Malawians harder, especially the poor

According to figures from National Statistical Office (NSO), the Malawi’s inflation  —the rate at which prices of goods and services change— for December 2015 rose by 0.3 percentage points to 24.9 percent from 24.6 percent the month before largely due to soaring food prices.

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 as importers and traders are passing on the high cost of importing to consumers.

“Overall, food inflation stands at 29.2 percent from 28.9 percent in November 2015.The increase in food inflation has been primarily influenced by rising by rising costs of other food items other than cereals.

“The increase in non-food inflation has mainly emanated from housing, furnishing and transportation costs,” says NSO Stats Flash.

University of Malawi economist professor at Chancellor College, Ben Kalua has urged government to work on taming the rising inflation and adopt measures that would help in diversification of food supply.

“There is need for government to start working now by among other things tallying the expenditure with available with available revenue,” said Kalua.

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

“Expenditure by government is partly to blame,” he said.

The inflation rate as measured by the Consumer Price Index (CPI) shows that the annual headline inflation rate for 2015 stood at 21.9 percent compared to the annual headline inflation rate of 23.8 percent in 2014.

Reserve Bank of Malawi Governor Charles Chuka said in 2016, monetary policy will aim to bring down annual headline inflation to the target of 14.2 percent in June.

In addition to the inflation target, the bank will aim at maintaining foreign exchange reserve coverage of at least three months of imports by June 2016,” Chuka said in the third monetary policy statement.

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.


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

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15 thoughts on “Tackle ‘cost of living crisis’ – Malawi govt told”

  1. Having people who are well educated with all recognised University Degrees, was our only hope that a poor Malawi would definately develop. But the way things are standing today in the economic devastated state of Malawi, We have lost hope now and we don’t know, who at this point in time is going to rescue us.

  2. Tisiyanji Nazombe says:

    Aproffessor diso kufiila choncho? Osasntha bwanji mamwedwe mwakula!

  3. Chagwa Lungu says:

    @Sapitwa, this village economics mentality is what is keeping our small country trapped in poverty. When was the last time you were in the village? I can assure you that life is not what it used to be in 1960, 1980, or even in 2000. Those in government should work on a long term solution to our economic problems. You can not rely on donors to solve every “foreseeable” problem. We had floods last year, El Nino was predicted long time ago, and cashgate has been a theme for the past three years. Lets clean up and act like real men and women. Lets agree that our economic structure is out of sync with the global economy. You would think with the price of oil at $28/barrel our economy would respond. How will it respond if even the Minister of Finance is saying our fate is in the hands of God? I am a believer, and yes may be some government officials and us citizens must REPENT but this will only save our souls, but our bodies will remain sick, hungry, poverty ridden and death ridden. The government should be PREACHING plans and strategies to get out of this mess once and for all. Maize can not sustain an economy. Tobacco has failed us time and time again. We need something bigger than one sector. Where is that National Planning Authority? Shouldn’t that be a priority?

  4. Sapitwa says:

    What are the villager’s basic needs?
    1. Ufa
    2. Ndiwo: nyemba, nandolo,chigwada, khobwe,nkhwani, tomato etc which can be grown and no need to buy them. It requires a hard working villager to grow these and sell surplus to get money to buy sugar, salt, cooking oil,soap etc
    3.Sweet potato, cassava, bananas,sugar canes etc. He can grow these and sell the surplus to buy other needs like fertilizer,clothes, pay school fees for kids etc.
    Over the years from 1960s,Malawians have lived a fulfilling life by growing some of the crops listed above and lived happily without getting bothered about what inflation is.
    Today, they have become so lazy such that they buy just everything and blame government just for everything even to an extent if having no pit latrines.
    Limbikilani kulima anthuni kuti mupewe kugula zinazi. Ulimi wothirira ulipo.

  5. 2016 welcome says:

    This is a hard lesson to all Malawians as we are in the same boat regardless of party colours. We don’t vote people without leadership acumen into key positions simply because we understand their language. I mean the president we have now, with all due respect, is to say the least clueless. We all remember how he performed as minister of justice, as minister of education.

  6. Ngwanya Weniweni wa pa Thyolo says:

    As long as Goodall is Finance Minister people should not expect the economy to improve. He is too old for the job, and feels that all is all well outside. For mathanyula, how can one preside over tree planting month ceremony in stead of using the sum spent on that day in preserving the tree remnants in the country. what we need is to deploy more guards to look after the remeining trees not planting trees which never see their next year. You plant a tree but not care for it and you think it will grow becoz you are mathanyula? Guys next time let’s not vote anyone over 60 years of age. these guys have nothing to lose but plunder this presidentless country. Who is not going to steal in this country? Kamuzu anatibera bad (cashgate NO1) Chair ndiye anagotichangamusa. Chiphaliwawali ndiye amatiopyedza kuti tisamasolole koma iye ndiye anali msololi mbava kawawa. Joy Band ndiye anali pasadaka tsiku lili lonse. Petulo Diesel ndiye uyu wapenga ndi thumba la Boma mpaka kugula Chimbuzi nkumayenda nacho pamseu. Zonsenzi onsewa amachitila ukalamba. Ngakhale kuwamanga tingotayapo nthawi chifukwa iwo chomwe angachite nkumwalira mwansanga basi. Woza Flames

  7. Kadakwiza says:

    Let me advice Professor Ben Kailua who is an economist. The problem is Malawians themselves, because they are just crying and complaining. Yet there is nothing they can do. Malawians always crying like babies. They just watch while their leaders abuse them, rob them. What they know better is crying. Malawi need another Chakufwa Chihana, serious speaking. Malawians Kumbwambwana too much.

  8. ben says:

    We are following Zimbabwes footsteps, they had uncontrollabe inflation because of continous devaluation of the Zim Dollar, now we Malawi are facing the same problems we cannot control inflation when Oil price in the international market are only a third of the value which they were but prices are same as 1 year ago, It just shows the economic team of Goodall and Chuka have misread the economy. The only option to stop inflation is dump the kwacha and and follow Zimbabawe accept US Dollar/Rand as our national currency. It is like we are losing pride but what do we do our economists have falied us and it is better to stop inflation now then waiting for it to reach critical levels and half of Malawi will leave for South africa to look for work as the Zimbabawens did.

  9. Jimbo says:

    Mr Goodall Gondwe said we would be ‘clapping hands’ about this time because of the improved economy. Now he says it has reached a ‘critical point’. So much for his forecast. Things have worsened and people are struggling. We need to know what Mr Gondwe’s answers are to the situation. Does he have any answers? What is stopping the government from meeting the demands of the donors? Whether Malawi likes it or not the country really needs aid to resume and quickly. Malawi has relied on aid since Independence and is clearly unable to manage without it. The government needs to take its finger out and show that it means business.

  10. mercy Nyirongo says:

    Goodal Gondwe Min of Finance and Ben KALUA Chief Economics commentator but malawi still at its low point…..we are watching

  11. KARU UNITED says:

    Goodal Gondwe Min of Finance and Ben KALUA Chief Economics commentator but malawi still at its low point…..we are watching

  12. Dikisan says:

    Olangiza amatha. Koma oyendetsa boma samva! Iwo amadzitenga ngati anzeru kuposa onse. Nthawi yomwe tili lero ndiyofunika kumvera maganizo a anthu. Sankhananipo za nzeru. Zingwiritseni tchito. Kuti import base yathu ichepe ndi increase export base. Mavuto anu ndi awa. Mumafuna muoneke kuti mukuyendetsa dziko pomangoyenda yenda kuyika aati mwala wamaziko.(Chitukuko palibe) Green belt ija ili kuti? Mafactory amanenedwa aja azophwaphwa ndi kufinya majuice ali kuti? Tavomerarani kuti tili pachiongolero koma nseu sindikuuona. Dzichepetseni, mwatsala pang’ono kuyaluka. Mmalawi muno muli anthu ambiri a nzeru. Ndipo enafe nzeru zaozo tadalitsika nazo. Tiyeni tiphunzire kuti tizipanga zofunika (necessary things) Osati popeza mfumu ina ikufuna kukaona kunja, inu muli tiyeni muli ndi ine tipita. Pano bwa! Ndiye fodya akadali mmunda. Mudikira kaye kuti mukapeze bodza lina loti mudzatiwuzenso. Phuma mwakumana ndi zosakumana. Tiyenazoni! Prof kkkkkkkkk

  13. Girl Lady says:

    Koma kuluyu uyu akudziwa kuti athu akugona ndi Njala ku malawi kuno mmm zovetsa chisoni izii mvula kuvuta olo therere la denje osalipeza mindamu Mulungu wakwiya ndi ufumu wa kuluyu atule pasi udindo mwina mvura ingangwe bwino tipeze chakudya ife asaaaaa

  14. mavuto says:

    Inu ma Economists mutipo chani pamenepa? Ntchito yanu ndi imeneyi boma mulilangiza zotani kapena nanunso mwangokhala ma economic commentators?

  15. sam says:

    The cause of this inflation is the devaluation of Malawi kwacha, how can we go from 440 in July 2015 to 720 in a spce of 6 months. There is something wrong with Reserve Bank they are not doing there job by protecting the poor from these shocks.

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