Malawi’s former minister Dr George Chaponda, who is opposition Democratic Progressive Party (DPP) leader in parliament , has faulted President Joyce Band and her government for the poor implementation of the Kwacha currency devaluation.
Chaponda, who has served as minister in various portfolios for the past eight years, said in the House on Tuesday that the process lacked measures to cushion the ordinary citizen from the effects.
The former Cabinet minister said Banda made an untimely announcement of the then impending devaluation which he said “ sent shock waves across the country and some shrewd businessmen hoarded their goods awaiting the devaluation.”
“The basic principle of economics is that when you devalue, you need to have some reserve of forex in the Reserve Bank as a backup. This was not the case. This has led to floating of the Kwacha,” said Chaponda.
He went on to call the remarks by the Reserve Bank governor Charles Chuka which said employees should not expect a pay rise but instead urged them to endure as “very painful”.
Chaponda said it is his hope that the Minister of Finance will soon unveil measures to address the situation.
“In other words from my party’s perspective, this IMF package should have been negotiated and implemented before or simultaneously as the devaluation was being effected and not the other way round,” said Chaponda.
“ In this context, let me make it absolutely clear that the Bingu administration was never against devaluation as some people tend to think,” he said.
“ The late President merely was emphasizing that the IMF should come out with a firm commitment on the package which would cushion the effects of the devaluation on the common man in the rural areas such as providing for additional public works program and so on,” explained Chaponda.