The tale of a stronger kwacha is gone, at least officially, since it depreciated on the street sometime. Inflation had been on the rise well before devaluation, and has only worsened of late in the aftermath. Nonetheless, the kwacha had to trade at rates determined by market forces or thereabouts. It is too early, however, to experience the benefits of a freely trading currency. But we cannot ignore the fact that life has become tough for ordinary and average Malawians, except for a few fat cats. It is important that the supply side, particularly job creation and a fair business environment must deserve more attention than before.
It would be sheer arrogance to expect the devaluation to solve all our problems faced by a typical household on a daily basis. Our issues have never been a monetary policy juggernaut, but supply side. Sometimes economics and its policy crafting should depart from the theory juggernaut of fiscal and monetary archaic tradition. Embracing the reality and practical nature of our problems solves some of our problems. For instance, how many households have a mortgage in this country?
The average Malawian household has no job, lives in the village and often depends on subsistence farming. Devaluation or not, they will continue to farm and sell bits of that surplus to fellow subsistence farmers and life goes on. In other words, they still struggle to send their children to good schools and canâ€™t compete fairly for a University place. A University of Malawi (Unima) or Mzuzu University (Mzuni) selection list will show that schools with privileged children score highly. Run the equation into the future, children that have been to good schools, often as a result of their privileged background, are likely to find themselves in the formal job market and succeed in life. Meanwhile, their counterparts will have dropped out and back into subsistence agrarian life that traps their generations into poverty. Devaluation never solves such problems.
All I am saying is: while devaluation is a fashionable monetary policy tool, our ability to move forward our country remains in job creation, quality education for all children and a war on corruption. Particularly, we shall need to ensure that our rural schools are equipped with necessary materials and qualified teachers.
While we made progress by introducing free primary school education, little attention was paid to deal with an evil-axis of corruption with its K187 million stamp. Schools have continued to underperform at national level and most young folks that trained to be teachers at the University have taken non-teaching jobs out of frustration and lack of career progression. Not sure if key crafters of public policy paid attention to the Obama-Romney debates, particularly how job creation and education as drivers of growth. There are some lessons to be learnt, not just maize distribution or fertiliser subsidies. People need to graduate to self-reliance, instead of cyclical, but politically correct tax-payer philanthropy. The modern version of neo-classical economic growth is mounded on a skilled labour force that can easily embrace technology to drive progress.
Devaluation is simply a change in the price of a currency. It is not a job creator, neither does it produce anything. The average citizen is at the centre of all things, and the politician accorded public trust to craft policies that move players into a higher income area with support of institutions to ensure fair play. Jobs will be easily created when equal opportunities exist for everyone and a similar set of rules apply. A tale of the 120 Malawians deported from South Africa this week via a cargo plane is a stark reminder of lack of job opportunities for our youth. Food for work is a good policy but it doesnâ€™t work for everyone.
A barrage of tenderpreneurs in their complex patron-client links continue to play by a certain set of unwritten rules that stifle many possible job creators with huge costs. We are still a country that success in business to some extent, depends on a number of bribes investors pay across the chain of services. It has been institutionalised and sometimes manifests itself in mediocre service delivery. Bribes act as insurance anyway. Serious war on graft can easily raise our rank on the ease of doing business and attract the much needed foreign capital.
With 2014 approaching and the battles developing among MCP, PP, DPP and UDF, I am yet to see how each one of them will address the issue of jobs. In most of our suburbs, young people are frustrated and are resorting to excessive drinking of the dreadful sachets of liquor. At the moment, it appears none of the political parties have put in place a candid plan to create jobs that can help families make ends meet, educate their kids and earn a decent living. It is of no use telling all of us that the fertiliser subsidy will continue. Our people have more dreams than just two 50kg bags of Urea or the other one.
To sum it all, devaluation was a necessary policy response but we need to strongly address the supply side of our economy. Malawians need jobs, fairness and equal opportunities to achieve their dreams. Otherwise we have let corruption grow to the detriment of the weakest of our beautiful country.