Malawi Kwacha continues to weaken against Dollar
Malawi currency, the Kwacha has continued on its weaker path onslide against major foreign currencies, and is now being sold in cash at K595 to a dollar according to foreign exchange bureau rates report from Reserve Bank of Malawi (RBM) while on the parallel market or black market it is hitting around K700.
Central bank spokesperson Mbane Ngwira explained that the devaluation has been induced by huge demand for forex and at the same time market speculation as Authorised Dealer Banks are hoarding forex in anticipation for better rates at a later stage.
Analysts say some major cause of forex shortage is the long-term fertiliser subsidy programme. With all its good intentions—to end hunger thereby contributing to poverty eradication, the subsidy requires thousands of drums of forex to import. Since the programme started in 2005, Malawi has been spending not less than K20 billion annually on the programme.
The country’s import bill for fuel, cement, metal bars and other construction materials has spiralled, victims of our own growth.
The other cause is the unscrupulous business people who siphon forex out of this country through fraudulent import transfers, hoarding, fake holiday packages and by literally zipping US dollar bills in the trousers while on foreign trips.
The fourth cause which has been controversial before is the state travel bill.
In the opinion of economist and Press Corporation Limited group chief executive officer, Professor Mathews Chikaonda, kwacha is losing its value because the country is still not able to generate enough foreign exchange to meet its import needs.
“We need to accept our reality. Just because we are in the tobacco marketing season is not a guarantee that we will have enough foreign exchange. RBM needs to keep some for the rainy day,” he said.
He advises that instead of just being an importing nation, the government needs to seriously implement export diversification drives to help the economy cope during the lean period.
The economy is currently facing pressure on the foreign exchange market largely due to speculation despite the country still selling tobacco, which wires in about 60 percent of the country’s foreign exchange earnings.
Please Malawians,get educated.How would your Malawian Kwacha get steam when your political stance is increasingly in tumultuous situation while the economic footing in egregious trend.In other words,it will take decades to stabilize in the sense that,the leaders you continue to elect on tribal lines instead of merit or acumen,you will remain in horrible and destructive way of life that will in the end,catapult our lovely motherland into a sinkhole of a failed state.Why can’t you learn from our brothers in Botswana or Zambia where tribalism and ethnicity are stories of the millennium.The fact of the matter is that when the… Read more »
No 51, so called “Defender of faith” you totally missed my point fool. Check your facts before opening your stinky mouth, thanks
nyapapi ndiwandale koma udzachokapo pamenepopo ndiwe fit
Iwe Dwambadzi # 33: Iwe ulibe Mpingo wako kapena atsogoleri ako kuti uwatume.
The negative effect of the Kwacha is due to the world economy, look at South Africa, Euro, Zambian Kwacha. The V effect as a result of strong American dollar.
Peter can’t lead and economically bail out Malawi his reaction time has a 30-year lag time that is mutchona mentality
Where is our doctorate holding advisor? Dr Phiri kindly advise the sleeping looting president
Some of u guys r blaming times. We r not poor nor do we lack forex. Where do you think the president was a few months ago? In America keeping up with his green card requirements. You fools still vote for these idiots.
The two programs – Agriculture Subsidy and the Malata and Cement Subsidy are both eroding our foreign currency. It needs a straight man to end this program and look into alternatives that could bring more income to the country. If the same money was spent on Forestry, then surely within the next 3 years the country would start realising benefits.
We are done now!!!!!!