Kwacha devaluation speculation leads to commodity hoarding
With the worsening economic situation that is tightly gripping Malawi, members of the civil society have sounded an SOS to government for an intervention on widespread commodity price hikes and hoarding of vital products.
This is coming barely a day after a conclusion of the IMF mission to Malawi that came two weeks ago to scrutinise the ailing economy and give solutions to government the major one being to devalue the Kwacha to trade at K300 per $1.
The fear from such an action has prompted reaction from markets across the country as many shop owners are hoarding basic commodities such as cooking oil, soap, salt and sugar plus constructing materials especially cement in anticipation of Kwacha devaluation that may lead to price shooting sky-high.
But the Consumer Association of Malawi has advised government to intervene on the matter since there are legal instruments in place to do so.
Cama Executive Director John Kapito said Malawi is not a liberalised market because although market forces are in play the Competition and Fair Trading Act is supposed to be invoked by government in times like these to protect consumers.
Kapito who is also chairman of Malawi Human Rights Commission also called for the establishment of the long awaited Consumer Council that will take full charge of consumer rights and Cama, an NGO with legal limitations.
On Monday evening forex agents from the black market were very active to amass dollars, euros and British pounds so that they make more after the anticipated devaluation.
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