Economics and Business Forum

President deserves productive advice

Leaders should give ear to everyone who speaks, but they must be selective in acting on that advice.

Those who are very vocal do not always give evidence of any consistency in the views they espouse and want to impress on leaders.

More of this will be given towards the end of this article. Suffice to say that at present, President Joyce Banda is being subjected to all sorts of threats by people who know what is best for the economic welfare of this country.

Before we are misled let us remember George Bernard Shaw’s famous dictum: “Those who can do, those who cannot teach.”

President Banda is being excoriated for not turning the economy around within the six months she has been in office.

Normally, the first months up to one year constitute the salad days for presidents, when they are still trying to master the job.

President Banda took over an economy that was in shambles. The previous government hid this although indicators were there that things were not adding up.

We were being told all was well when it was not. It is like keeping a sick person for a long time, treating him with drugs that do not help.

When the illness has become chronic, you take him to a hospital and you become disenchanted because the doctor’s prescription is a painful one.

In criticising the Banda administration, some people give the impression that the period before devaluation was better than the present. Was it really? How about those long fuel queues when people used to park their vehicles at the service stations for days? What about those days when some factories had to be downsized or closed because of fuel shortage? Were those not the days when Malawi’s relationships with donors cooled to a freezing point?

The aim of devaluation was to reinvigorate the economy. Advocates of devaluation used to say the kwacha was overvalued and that devaluation would make Malawi’s exports more competitive on the international market. It was assumed that we will be able to sell our goods in large quantities and bring home more foreign exchange.

But has the devaluation brought in the much needed foreign exchange? I am not very much in the know on this. Maybe it has not. The reason is not difficult to guess.

The economy of Malawi is agro-based. The country exports tobacco, cotton, sugar, tea and coffee. Growing the crops depend on moisture. The present government was formed at the beginning of the dry season. Whatever policies the government has devised for improving the agricultural sector cannot be effective until the advent of the rainy season.

We must, therefore, wait until the next dry and market seasons to judge whether the Banda administration has turned the economy around.

If Malawi had a big manufacturing sector that is less dependent on rains we would, of course, start judging the present government at once.

Even in industrialised countries, measures which were taken to turn economies around after the 2007 to 2008 financial meltdown took at least two years to show results.

Those who are saying the President should resign because she has not provided cushion against the pain brought by devaluation are motivated by partisanship.

Economic laws differ from statutory laws. Parliament can convene tomorrow and repeal all laws enacted by the previous government.

The Banda Parliament has done just this. But economic laws cannot be repealed by Parliament.

Economic laws are part of natural laws and they obey the prescription of nature.

The law of nature asks: Do you want to transform the economy through agriculture? Fine, prepare your gardens in readiness for the rains. Even after cultivating land, you wait for the crops to grow and ripe. You go through all these seasons. No edict per se can bring about the expected results.

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