Vision 2020 fails to aspire hope

With only six months to go, Malawi’s hope of attaining sustainable growth and development and becoming a middle income country are up in smoke following failure of Vision 2020 to materialise.

If the Vision 2020 aspirations were anything to go by, Malawi could have been secure, democratically mature, environmentally sustainable, self reliant with equal opportunities for and active participation by all, having social services, vibrant cultural and religious values and being a technologically driven middle-income country.

At the time of formulating the development strategy, per capita income was hoped to grow to $1 000 by the year 2020, with Economic Development Document for Malawi indicating the same to hover at around $500 as of May 2017.

The mining and manufacturing sectors were another highlight. At the time of the strategy inception, the sectors contribution to the GDP stood at three percent and 12 percent, respectively.

As at 2018, figures from the Malawi Annual Economic Report indicates that the sector’s contribution stands at below one percent and nine percent, respectively.

Savings rate on the other hand has plunged from 15 percent of GDP from 1995 to roughly about three percent, according to figures from the Reserve Bank of Malawi (RBM).

At 15 percent, the national savings rate was then considered too small to meet the investments of the country.

The strategy also envisioned the creation of an export-oriented economy, a fair and equitable distribution of income and wealth, a well-developed and maintained economic infrastructure, develop domestic and international tourism as well as improve selling prices of most crops produced by smallholder farmers are very low, among others.

The Gini coefficient, a measure of income inequality, had deteriorated from 0.45 in 1968 to 0.62 in 1995 while only 12 percent of the labour force was in formal employment in 1995, according to the National Statistical Office (NSO).

According to the 2019 African Economic Outlook Report commissioned by the African Development Bank (AfDB), Malawians’ incomes are still very low, with GNI per capita of $360 (about K263 000) in 2016. GNI per capita is the dollar value of a country’s final income in a year, divided by its population and reflects average income of citizens.

Further, the report, states that inequalities are acute and rooted, with a Gini coefficient [measure of statistical dispersion intended to represent the income or wealth distribution of a nation’s residents] of 0.46 in 2010 and .44 in 2014.

A National Statistical Office (NSO) Malawi Poverty Estimation Report which covered the period April 2016 to April 2017 also stated that moderate poverty levels in the country did not change.

It said ultra-poverty had declined from 24.5 percent to 20.1 percent while overall poverty has slightly increased from 50.7 percent to 51.8 percent, which economists say is an indication that there is still a lot of vulnerability in the country.

On the otherhand, government is yet to implement the Domestic Tourism Marketing Strategy, which seeks to sustain the growing local travel for sustainable local tourism.

The strategy, once implemented, is expected to contribute to tourism growth by about four to 15 percent of the country’s GDP by 2020.

Economics Association of Malawi (Ecama) president Chikumbutso Kalilombee told Business Review on Tuesday that while it is clear that most of the set objectives have failed, the association is banking on the National Planning Commission (NPC) to drive the ntional agenda regardless of the political scenario, which was not the case with Vision 2020.

“I think we need to be honest that as regards Vision 2020 we as a country have failed. What we need now is to rethink the short, middle and long term goals going forward.

“Elections as have happened now give chance for a restart and we hope that will be the mode going forward. Further on, we now have the NPC which should drive the national agenda regardless of the political scenario which we didn’t have with Vision 2020,” he said.

Economist Gilbert Kachamba said the country could have been somewhere else if the targets set in the strategy were at least half achieved half-way.

“We will not make the country a middle-income economy neither increase the growth rate to at least 12 percent. It is not a good development that we have failed. The successful implementation has been missed. Maybe it’s now time to revise the vision otherwise, we have missed it all together,” he said.

Speaking separately, economist Frederck Changaya said Malawi need business approach to deliver on written blue prints observing that while there has been poor implementation, design of development was also faulty.

“Our focus as a country on agriculture and services is not the right one. Malawi has to refocus on industrialisation,” he said.