Bingu govt blames World Bank, IMF for economic woes
President Bingu wa Mutharika government has appealed to African Union (AU) to hears his government’s side of the story regarding July 20 protests that resulted in 19 deaths and blamed the World Bank and the International Monetary Fund (IMF) for her economic problems.
In a statement released by Malawi Embassy in Ethiopia, the Malawi government has written to the AU and Economic Commission for Africa to explain that the protests had nothing to do with the issues raised in a petition by lobbyists but a plot by opposition parties to overthrow the government.
The statement said the key justifications for the demonstrations, as presented by the organizing NGOs were; shortage of motor vehicle fuel; shortage of foreign exchange and intermittent supply of electricity.
“These shortages have always been experienced under previous governments formed by the same opposition parties that have partnered with the NGOs. There is no record that either the NGOS or Members of the opposition parties ever demonstrated in the past against these shortages,” said the statement.
Government said the problems of fuel shortage in Malawi, arose first because the World Bank prevailed upon the government to privatize the purchase, importation, marketing and distribution of petroleum products from a former government owned enterprise; the Petroleum Control Commission to a privately owned Petroleum Import Limited.
“The privatization of this strategic commodity has rendered Government helpless to regulate the flow of fuel into Malawi, let alone to maintain any reserves. Second, the landlocked nature of Malawi, with very long and difficult distances from Indian Ocean ports has meant that any delays at the ports result in the depletion of the limited fuel reserves in the country.
The government also pushed another blame on the International Monetary Fund (IMF) on forex crunch, saying the organisation insisted that the proceeds from Malawi’s major exports, including tobacco, the strategic crop of great national significance, be kept with Commercial Banks and not the Central Bank of Malawi.
“As a result, all Malawi foreign exchange earnings are held by private banks outside the country where governments cannot exercise control.”
The statement said if the Government had rejected the above prescriptions it was certainly going to be condemned by the NGOs fearing that this would jeopardize their funding which totally comes from outside the country.
“Accepting the prescriptions has led to consequences which have provided the NGOs with justifications for the demonstrations.
“Even in good times governments do have to prioritise, in the case of the Malawi Government, it has been prioritizing the procurement and distribution of farm inputs and hospital drugs which benefit majority of the population.”
On the intermittent electricity supplies, the statement said they are due to major repair works following lack of maintenance of energy generation plants by previous governments, insisting “they are not a permanent feature.”
The statement adds that the July 20 demonstrations were organized by NGOs, opposition parties, in collaboration with members of the media.
Government blames civil society saying they “receive a lot of covert funding from outside the country” and accused local NGOs of not investing their funding in laying down the foundations for economic development like skills training but funds in “lofty agendas that ran contrary to the cultural tenets and moral fabric of the nation.”
The statement claim political parties are using the demonstrations to access the excessive financial resources of the NGOs in promoting their political agenda.
The statement said Malawi government needs “the space” to govern.
“It is not proper that it should operate under ultimatums and prescriptions from special interest groups,” it said.
Apart from being under fire over chronic fuel and foreign exchange shortages, Mutharika is also accused of infringing democratic freedoms in the Malawi.
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