By Wezzie Gausi:
Consumers Association of Malawi (Cama) has outlined 11 measures the government should adopt in an attempt to cushion Malawians from effects of the recent 44 percent devaluation of the Kwacha.
Cama proposes an immediate stop of the Affordable Inputs Programme which, it says, has failed to help Malawi achieve food security over the years.
Cama suggests that the government should stop payment of allowances and subsidies that are allocated to what it rated as a non-productive sector.
In a statement issued yesterday, the consumer representative body also proposes a cut on the number of presidential advisers to not more than six.
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It says the government should implement comprehensive clean wage contracts, especially for its senior officers.
The proposals come barely a week after President Lazarus Chakwera announced tough measures which his government has put in place to cushion Malawi’s troubled economy.
They followed a 44 percent devaluation of the Kwacha and after the International Monetary Fund (IMF) approved a four-year Extended Credit Facility (ECF) programme pegged at $174 million.
But in the statement, Cama Executive Director John Kapito said more and tougher measures were required to fasten the recovery process.
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“So we believe that the suggested austerity measures will help to caution what the consumers are going through after the devaluation,” Kapito said in the statement.
He says the recent devaluation should be a signal to the government to work towards ensuring prudence in public finance management as many of the problems the country is facing are emanating from overspending by the government.
He fears that the devaluation would still have a harsh effect on consumers’ disposable income and the price of goods and services.
“The devaluation will also affect most businesses and industries, so some will scale down and others will close as demand for goods and services declines,” Kapito warns.
In an interview yesterday, Economics Association of Malawi (Ecama) President Betchani Tchereni echoed Kapito’s voice on cutting the number of presidential advisers and further lowering benefits for senior government officials.
“I also agree with Cama that AIP is a subsidy which has been called many names in the past. We really must start to work towards an existing strategy and focus on more viable means of food security,” Tchereni said.
Recently, the government was told to institute debt audit/ inquiry for both domestic and foreign if the country is to recover economically.
