Five days into the New Year 2012 and the noticeable change, at least to many Malawians, is the last digit in the calendar year. Otherwise, from the look of things, it appears we have carried over all our excess baggage and problems from 2011 and before.
Last week, I said we need to look at life positively and hope for the best in 2012. But how can one hope for the best when filling stations are still dry? Indeed, how can one be positive when power supply remains the Ã¢â‚¬Å“here tonight, there tomorrowÃ¢â‚¬Â loadshedding arrangement instead of the brand promise of Ã¢â‚¬ËœPower All Day, EverydayÃ¢â‚¬â„¢ or is it Ã¢â‚¬ËœTowards Power All Day, Everyday?Ã¢â‚¬â„¢.
Tuesday this week marked the first business day in the New Year. However, foreign exchange applications, carried over from 2011, continued to pile in pending trays in authorised dealer banks due to forex scarcity. And, looking at the situation on the ground, there is no hope that forex will be available anytime soon, at least if those entrusted with authority continue to live in denial of the realities.
Simply put, times are hard for many Malawians economically. Prices of many basic needs are skyrocketing at an alarming rate that one wonders how far we will last (kaya tilimba kaya?). We are going through probably the worst period economically characterised by price hikes and shortages. What one was able to buy with K1 000 ($5.98) two or three months ago, they cannot afford today.
Why are we in this situation? How did we find ourselves in this situation? How do we get out of this mess?
Malawi Confederation of Chambers of Commerce and Industry (MCCCI) chief executive officer Chancellor Kaferapanjira hit the nail on the head last week when he faulted President Bingu wa MutharikaÃ¢â‚¬â„¢s Ã¢â‚¬Å“anti-devaluationÃ¢â‚¬Â stance. When he assumed office in 2004, Mutharika pledged not to devalue the kwacha to protect consumers, so we were told. However, with or without the 10 percent devaluation in August 2011, commodity prices did not remain the same as they were in 2004!
What the President, an economist, is not telling the nation is that his Ã¢â‚¬Å“anti-devaluationÃ¢â‚¬Â policy can no longer hold. Things have gotten out of hand. Reality can no longer be suppressed; hence, his finding scapegoats such as the Devil, previous regimes as well as civil society and Ã¢â‚¬Å“brain washedÃ¢â‚¬Â local economists (perhaps he is a foreign economist) as the sources of our problems.
I am not an economist, but I do understand and maintain that devaluation is necessary to ease the shortage of forex. Further devaluation might be a more painful option, but, at the end of the day, we need to have foreign exchange reserves to have regular supplies of fuel, medicine and other commodities.