Archbishop Mark Kambalazaza of Charismatic Renewal Ministries has challenged government to “come out in the open” and explain strategies it has in place for economic recovery in the country.
Malawi economic impact looks uncertain; with Finance Minister Goodall Gondwe admitting the country is now facing “huge challenges”.
Kambalazaza noted that Malawians are grappled with increased inflation, mass unemployment and widespread poverty.
He said with the frail economy, there is need for government to explain openly what kind of policies it will pursue for recovery.
“We need to ask government to come out in the open and explain what policies they will pursue [for economic recovery,” said Kambalazaza on local radio.
“What is the strategy of rebuilding the economy, we need to know,” he added.
The continued depreciation of the kwacha is driving up the cost of living and increasing social stress in the country, a situation the Malawi Confederation of Chambers of Commerce and Industry (MCCCI) has described as “getting out of control”.
Newton Kambala, president of MCCCI said the business community is “very concerned” about this kwacha volatility.
“Malawians have not seen the impact yet; they should expect tough times ahead. It will be tough,” he warned.
Kambala said the industry is shrinking and the long-term impact might be massive job losses.
The local unit has over the past two months lost about 30 percent of its value to the dollar and has hit a record low of K610 in most foreign exchange bureaus and nearing K650 on the black market, while averaging around K550 in most Authorised Dealer Banks (ADBs).
Blantyre-based Nico Asset Managers Limited, a local investment advisory firm, in a recent report forecast that the kwacha would continue to depreciate.
Newspaper columnist Ephraim Munthali argued that Governor of the Reserve Bank of Malawi Charles Chuka and his crew have little on their disposal by way of monetary instruments to rejuvenate the economy.
“All they can do now is hope and pray, which is not an option considering the pain citizens are going through,” Munthali wrote in his ‘Cut the chaff’ column in the Weekend Nation.
“As for Finance, Economic Planning and Development Minister Goodall Gondwe, he missed an opportunity for bold measures in the just passed budget to use fiscal policy to pump some energy into the economy.
“Those cuts to allocations, while understandable in the context of austerity with a Treasury ransacked by Cashgaters, deserted by donors, starved by an underperforming Malawi Revenue Authority (MRA) on the back of a bleeding private sector as well as its own revenue collection inefficiencies, are not helping matters either,” wrote Munthali.
Recently, Gondwe talked about measures for revising the economy, citing a World Bank-funded cash transfer programme he hopes could act as an economic stimulus as well as the LRR cuts by the RBM.
“But given how depressed the local economy is, these are too little to lift the ailing economy’s spirits,” argued Munthali.
“The only ray of hope for the country maybe five months away during the Mid-Year Budget Review Meeting of Parliament where, I hope, Gondwe could come up with bold measures to save the economy, which should include an expansive stimulus programme targeting massive infrastructure investment and cash transfers.
“Where will the money come from? Well, I would not mind widening the deficit on carefully selected public infrastructure investments that have multiplier effects on the economy.”
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