Mutharika on reset to improve economy: Malawi passing through ‘turbulent times’
Malawi President Arthur Peter Mutharika has said he will not be distracted as he focus on improving people’s lives by hitting the reset button of governance to improve the economic situation.
The country has been on economic downward spiral which the President conceded in his year-end State-of-the-Nation feed from Kamuzu Palace in Lilongwe that was beamed on radio and television stations on Saturday night.
Mutharika said his DPP government inherited huge domestic debt and enormous arrears owed to providers of goods and services to the government from the Joyce Banda administration which he was rebooting the ills.
“High political aggrandizement, self-glorification, and massive corruption were characteristic of most of the period between mid-2012 and May 2014. Further, the pride and confidence of the Civil Service was fast waning off,” pointed out President Mutharika.
He attributed the current economic turmoil due to cashgate corruption scandal, saying his government “inherited empty coffers.”
The Head of State pointed out that due to cashgate, cooperating partners withdrew their budgetary support to the country and his administration is running on zero-aid financial plan.
“It is common knowledge that Malawi is now operating without general budget support, meaning we have to rely more and more on ourselves to deliver the services that Malawians need. Moreover, in the spirit of good economic governance, we can only spend what we have,” said Mutharika.
“It is against this background that my government does not allow unplanned expenditures, and has stepped up efforts to deepen adherence to the existing economic governance laws,” he added.
He noted that the local currency, Kwacha, has been losing to a quarter of its value in relation to the US dollar, and the impact shows strongly through inflation arising to the associated rising costs of imports.
“This inflation has exerted pressure on interest rates, hence lowered private investment and employment. Much as seasonality explains part of the kwacha depreciation, a significant part of it is attributable to speculation,” said Mutharika.
The President said he has “better news” for Malawians.
“The Kwacha has since stabilized,” he disclosed.
“I am hopeful that the domestic currency may even appreciate soon, because we are doing everything possible to get the economy on the right track,” said the President.
He informed that his g government has put in place policies that will translate into increased exports in order to increase foreign exchange earnings which are needed to defend the domestic currency.
Mutharika said despite challenges facing the Malawi economy, “the financial system has stabilized and developments are visible in the financial institutions and the capital markets.”
The Malawi leader, however, pointed out that the risks to the economy continue, and the government is specifically working its way forward with the uncertainty regarding the resumption of budgetary support, delayed donor inflows, and low tobacco prices.
“Inflation remains a risk that has to be tamed, moving forward.”
He said DPP government is “very determined” to turn Malawi’s ailing economy round.
Mutharika said Malawi economy will grow by an average of 5.5% in 2014, from an estimated 5.0% in 2013.
“This rate is agreed by the International Monetary Fund (estimated 6.12% growth), the World Bank (4.4%), and the Reserve Bank of Malawi (6.3%),” he said.
He also beckoned investors to consider Malawi, assuring that his government will provide “the environment that will make businesses flourish” and create a win-win situation between private investor and the government.
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To be honest, Malawi doesn’t have a leader. There is no inspiration of the future. It will another 5 years wasted. If we, as a country, continue @ this rate, in 3 years we will be non existent unless God does us a favour. Leadership is inborn not academic excellence. JB , soon after taking over from Bingu (MHSIP) positive changes were noted and she become a darling 4 the people unlike now when all hope is lost.
well I personally do not fault donors for not injecting any more money into this system! I want them to stay away and Malawi needs to be subjected to tough love! how can a country be so irresponsible for so many years? its because the money was bing given to us! now we have to crush learn how to manage our money! yes there will be pain and calarmities but by the end of that process this little sleepy country will have learned that if you cheat your country you are cheating yourself! you can’t amass chuma at the expense… Read more »
muthalika mbuzi ya ma proffefor. bulutu opanda nzeru bingu anaba eeeeeeeeeee kuba mpaka chitafera pamwamba pa penamulungu paja anthu anakatenga ndalama ku ndata ndi nyamba zaboma. mmene munkayamba mumkati mwapeza ndalama zongokwana 8 months basi nde 8 months yatha kale galu iwe. wangounjikila mabulutu anzako mukuti ma mp pamene athu a mboma akulira ndi kukuta mano .
There is actually no need to be this rude becaue all these things you are sayng are all in your head! you have no proof at all. You are demonstarting that you are a savage of all savages!
Let me tell you that u professor sapatana ai! you have to work for it and this man has worked ion his life what have you to show for your self? shame on you Syamboza! ndi dzin lomwelo locita kumveka kuti ndiwe mbuli ya lende lende!
This bafoon of a Prof was there when his equally foolish brother run Malawi to the ground. World Class Professor or World Class Fool
Is this the pudding that Ben Phiri was yapping about? Za nsete zokha zokha .
Mr president you are testing your own medicine. Stop yelling about JB! Leave mama alone. Osamangoti fwe fwe fwe apa.
A nation is as good as its leader. Malawians you chose this clueless leader and therefore you deserve hard times. Next time vote wisely-not matchona apa pension waiting to die. They have nothing to lose but everything to gain. Muisova!!!
A Malawi enanutu mukuyanhula nga nzelu muli nazo. You are failures in your families and that’s why you are here unconstructively criticizing the world class professor of Law instead of trying to understand and learn from the thinking of this professor.
inu ndi anthu opanda mwai!!!
APM you just speak Fwee fwee fwee as if you have your head in the mud. How can you continue to blame the previous government when you fail to kick start the economy? You claim its becasue of gubede gubede cash gate. EEEEE cash gate this cash gate that you forget your brother and you during his reign clean up the coffers? JB only took over from where you DPP guys left off. So please do not give us that sobbing story of empty coffers. The coffers were almost empty when JB took over in fact she took all the… Read more »
Clean up MRA GEORGE MANKHWARA CAN’T BE A MANAGER. MBULI THERETU.
Chokani apa a Mzumara. Mulilatu simunati. Nsanje basi ngati nkazi. Anthu a ma bachelor of education, bachelor of arts, biology etc you think mungayendetse company? Go back to teaching that’s what you know. Ma lawyer obweleza ku chancol what do you know?