Economics Association of Malawi president Henry Kachaje wrote in a certain forum this week that in basic terms, the Extended Credit Facility (ECF)—Supported Programme is like an economic drip that the IMF puts on ‘‘economically sick nations’’ to help them recover. The ECF mainly supports the balance of payments (BOP).
It is a form of financial assistance to countries with protracted BOP problems, aimed at helping them move towards a stable and consistent macroeconomic position consistent with strong and durable poverty reduction and growth.
Kachaje urged Malawi to be discharged from the IMF ICU it has been frequently admitted to during the past 52 years. He exclaims that being declared back on track with the IMF-ECF should never be a cause for celebration, for this basically means a patient who is back in ICU.
What Malawi must aim for, argues Kachaje, is for a full recovery and discharge. Malawi must join the likes of Mozambique, Tanzania and Rwanda on the African continent that were discharged from the IMF-ECF. He strongly believes that the country can do it.
‘‘Let this be our final time in the ICU. This will be possible if you and me double or treble or quadruple our productivity and economic output,’’ he concludes. I cannot agree more with Kachaje.
He must have been referring to congratulatory messages from ministries, departments and agencies (MDAs) that the State-controlled Malawi Broadcasting Corporation has been running congratulating the President and government following last week’s announcement by the IMF that Malawi is back on track the IMF-ECF programme. The development means that in the next two months, the country will qualify for a $30 million credit facility from the Breton Woods institution (the IMF-drip).
The congratulatory messages on government are nothing but a public relations stunt on its finance management reform programme. It’s like government patting itself on the back for doing what it is supposed to do.
Government should actually aim at fighting the devil that is domiciled among its rank and file that are wreaking havoc to the public pulse. This devil is well known. It is the continued looting of the government resources by no other than government employees themselves.
It is a well-known fact that 30 percent of the country’s budget goes down the drain unaccounted for. As far back as 2002, the then director of Public Prosecutions Fahad Assani pointed this out. Twelve years later, the Baker Tilly forensic audit report revealed that within six months—between April to September 2013—the national pulse was looted as much as K24 billion by civil servants and business people.
As we all know, this was just a tip of the iceberg as an investigation by PricewaterhouseCoopers (PwC) data analysis report would reveal in 2015 that a jaw-dropping K577 billion could not be reconciled in government’s bank statements between 2009 and 2014. Wasn’t this more than a third of the national budget during the mentioned period? Malawians are waiting with baited breath for the outcome of a forensic audit report on this. Thanks to our development partners who are bankrolling a forensic audit currently underway on the PwC report.
Now, if donor aid constitutes 40 percent of the country’s national budget and 30 percent of it (the national budget) is stolen, does it not mean that we only need 10 percent assistance for the national budget if we stopped the looting of the national budget which donors have on several occasions described as a leaking bucket?
Kachaje has talked about the need to redouble, treble or even quadruple our productivity. Surely if we did this it would not be difficult to be discharged from IMF-ICU. All we need is to pluck a leaf from Mozambique, Tanzania and Rwanda which have waved goodbye to the IMF-ICU. Kill the thieving spirit and corruption which are so entrenched in high places.
The starting point is for government to expedite the forensic audit on the K577 billion. Name and shame the thieves. Without doing that we will continue celebrating getting admitted to the IMF ICU. Shame on us!
- The articles appeared in the Weekend Nation newspaper.