On figures, don’t trust the DPP government

I shall return to Chitakale in Mulanje. Not because of its scenery; the burning heights of Mulanje Mountain standing silently on the green spread of the tea plantations. No!

Rather, whenever I visit Chitakale, I am taken back to 2002 when I was a student sitting on the floor of the Form Two classroom at Chikwina Community Day Secondary School (CDSS) in Nkhata Bay.

Yes, I recall studying the Sweet brew of Chitakale by Ken Lipenga and spurred by Lipenga’s weave of story; I couldn’t help, but fantasise visiting and tasting the sweet brew of Chitakale.

Such is Lipenga’s genius—a man of letters who, since last year’s tripartite tragedy, has shrunk to obscurity.

Where is Dr Lipenga?

With increased interventions in secondary school, Junior Certificate (JC) English Literature, I am sure a few would remember Lipenga as a fine writer.

We also remember him as the Finance Minister during whose tenure budget review documents were packed with questionable statistics.

His appointing officer, former president Bingu wa Mutharika, after diplomatic brawls with the donors, lost the donor’s hand in budgetary support. To survive, Mutharika developed a zero-deficit budget.

The economic slaps we endured on the ground didn’t need figures to prove the zero-deficit budget wasn’t working.

But the Treasury, then sexed-up figures just to cover up the lie that the zero-deficit budget was working. The lie was carried to the public—and, minus George Mnensa the whistleblower, we all smiled that the zero-deficit lie was working. How foolish!

We came to realise later, after Bingu’s demise, that we were lied to—that Treasury borrowed heavily from the Malawi Revenue Authority (MRA) to cover up the financial deficiencies that came with the zero-deficity budget.

Can you, then, trust the Democratic Progressive Party (DPP) with financial figures—a party that when in power— has a history of sitting in the dark, sexing up figures to brainwash taxpayers with outright lies?

Between 2006 and 2009, Malawi—because of a combination of a strong opposition and a weak, but willing government—enjoyed a great deal of financial goodwill mostly from international friends.

Our huge debts were forgiven.  Budgetary support was resumed. And the Chinese, in compensation for our ditching Taiwan, thanked us with billions. Our Treasury, plus domestic revenue, experienced a great boost.

However, until now, I still can’t figure out how such externally driven financial injections could make Malawi the world’s second fastest growing to oil-rich Qatar.

But how the DPP government spread the ‘second to Qatar’ gospel was quite phenomenonal. Were they really telling the truth?

Few months after we lost external goodwill, the country slided into abyss. No forex. No fuel. Rising commodity prices. And etcetera…

I paused and asked: Is this really the country that was growing second to Qatar?

Today, amidst economic wounds rooting from 2010, the DPP government is at it again. We know that this is not the tobacco selling season and we know we are still importing more than exporting, but the DPP keeps telling us about improvements in the country’s forex cover.

I am told our reserves stand at $597.91 or 3.13 months import cover. This, according to government, has been achieved through purchases from market and sale of government debt to institutional investors.

I am told Treasury, through what they call currency swap, sold the $250 million dominated in kwacha debt it owed the Reserve Bank of Malawi (RBM) to the Preferential Trade Area (PTA) bank using dollars.

Finance boss Goodall Gondwe argues that the transaction does not mean Malawi has heavily borrowed from PTA, but simply a swap and ‘nobody will lose out’.

But there is a good reason you should not listen to Gondwe. Why did government bypass Parliament in making such a big transaction?

Trust me, with the history of DDP, you will, in days to come learn that they borrowed heavily to improve the import cover. You cannot trust the DPP with figures.