Malawi risks a full-blown health crisis if the prevailing foreign exchange scarcity is not addressed to facilitate easy importation of medicines, the Pharmaceutical Association of Malawi (Phasom) has warned.
In a statement made available to The Nation, Phasom said pharmaceuticals are struggling to import medical supplies, including drugs, due to the shortage of the dollar, the preferred currency for procurement of medical products on the international market.
It said the situation is leading to a shortage of medicines and medical supplies in the country, thereby putting people’s lives at risk.
The statement reads in part: “Both the public and private sectors are struggling to ensure and sustain the availability of medicines and medical supplies in the country.
“Most public facilities are stocked out of essential medicines. The private sector has been equally affected as they are struggling to import medicines in the country due to scarcity of forex.”
Phasom warns that stock-outs have severe consequences on the community, including “treatment interruption or discontinuation, catastrophic expenditures, increased hospital admission and stay, treatment failure and the development of complications, drug resistance and ultimately increased risk of illness, incapacitation, deformities and death”.
The association said suppliers have been compelled to import medicines using the euro currency, which is expensive and makes the products exorbitant and unaffordable to many.
In a telephone interview on Monday, Phasom president William Mpute said they are appealing to the Reserve Bank of Malawi (RBM) to ensure commercial banks prioritise the allocation of the dollar to the pharmaceutical sector at the official bank exchange rates to improve supply of medicine and medical supplies.
The Central Medical Stores Trust (CMST) said it is equally struggling as some of the suppliers given contracts are unable to deliver due to shortage of forex.
The trust’s public relations officer Herbert Chandilanga: “Yes, CMST has also been affected by the scarcity of forex. Some suppliers have cited lack of forex as the main reason for delayed deliveries to CMST.”
He said the trust has since engaged all relevant stakeholders, including RBM, adding there is forex provided for some of the trust’s direct imports.
Parliamentary Committee on Health chairperson Mathews Ngwale said his committee is aware of how forex scarcity is affecting availability of medicines and medical supplies in the country.
He said the committee has been in touch with CMST and engaged Ministry of Finance on the issue.
Ngwale said: “We have engaged Ministry of Finance, but they do not seem to have a clear answer. Our prayer is that maybe after tobacco sales forex reserves may improve.
“We implore government to make the little forex available to pharmaceuticals to avoid a serious drug shortage in the country.”
He said as a committee they have done their part to lobby for the required support to CMST, including provision of the K12 billion bailout package to the trust as well as negotiating with Public Procurement and Disposal of Assets Authority to facilitate smooth procurement of medical products.
Ngwale said: “CMST has the money, but cannot procure products because of forex. We need to treat this as a matter of urgency.”
Health rights activist Maziko Matemba in an interview on Monday said while he appreciated that government has competing priorities requiring forex, pharmaceuticals should be regarded as another priority.
Malawi has been reeling under foreign exchange shortages since the termination of a foreign exchange swap deal in 2020. Inflows from tobacco, the country’s main export crop, have also dwindled in recent years while international trade was hampered by the Covid-19 pandemic.
Last month, Petroleum Importers Limited (PIL) raised fear that the lack of forex could lead to fuel shortages in the country.
In a written response on Monday, PIL general manager Martin Msimuko said they now have the support from some commercial banks which are in turn supported by RBM to ensure steady supply of fuel in the country.
RBM spokesperson Ralph Tseka was yet to respond to our questionnaire on Monday on the pharmacists’ plea.
But figures from RBM last November showed that the country requires $3 billion annually to meet imports requirement. However, the country generates $1 billion forex per year.
Each month, Malawi spends an average of $250 million for imports. Tobacco, on the other hand, raised $197.1 million last year.
The data shows that gross official reserves under the direct control of the central bank dropped by 2.83 percent to $374.48 million as at March 31 2022 from $385.40 million in February. Private sector reserves also decreased by 3.86 percent to $391.49 million from $407.22 million during the same review period.
The drop in the reserves position, according to market analysts, reflected the increasing burden on the centrqal bank to support the foreign exchange market with liquidity to help either in smoothening the rate of depreciation or payment.