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Inflation leaves Malawians hopeless

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The ceaseless rising levels of prices for basic food items for a household in both supermarkets and local markets over the past three months has left many Malawians hopeless as government officials continue to sound vague on measures being implemented to move out of the situation.

Our visits to some shops and produce markets indicate that prices of some basic household needs have alarmingly soared while most of the people’s salaries and wages have stagnated for a long time.

To make matters worse, some companies are now either directly or silently retrenching staff due to the country’s worsening business environment.

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Malawi’s inflation rate was recorded at 24.90 percent in December of 2015 and remains the highest in Southern Africa.

Some basic items, whose prices have been steadily going up, include maize, bread, soap, sugar, cooking oil, tomato and the commonly sold dried fish.

Between December 1, 2015 and February 1, 2016 price of maize has moved from around K7, 000-K8, 000 to around K13, 000- K15, 000 per 50 kilogramme bag in most areas. This leaves out some areas where people are reportedly buying the bag at over K15, 000.

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Sugar has also moved from K500-K600 to around K650-K750 in some local markets.

Bread has gone up from around K230-K250 to around K300-K350 in most of the shops.

A two-litre bottle of cooking oil whose price in December was hovering around K1, 500-K2, 000 has gone up to over K2, 800 in some shops.

Malawi Energy Regulatory Authority (Mera) has not been merciful either. During the period in question, it has approved Electricity Supply Corporation of Malawi (Escom) tariff hike thrice.

Water Boards have also raised the charges for the precious liquid, as if ensuring that there is nothing left for the people’s bank accounts and wallets.

The recent trend has also seen the supermarkets silently abandon the one-time fashionable end of month promotions.

In random interviews that we conducted, people have expressed their disappointment at the rate the value of their hard-earned kwacha is being washed away in the face of skyrocketing prices.

“Honestly, the rising prices of goods have hit my family hard. In the past, it was easy to implement a budget for my four-member family but things have completely changed for worse.

“In those days, the money I was realising from my business was enough for, at least, the basic needs. But today using the same budget is far from being enough for the family needs. Everything including food, soap and all other basic needs are expensive now,” MacDonald Chisale, a secondhand clothes seller said.

Robert Mpakeni, who just said he does small businesses, described it as sad that currently a K1000 is not even enough for a packet of sugar and loaf of bread.

He accused the government of failing to take control of the economy as the citizenry continues to suffer.

“We do not know what the government is thinking about us but there is need for them to do something. Right now, a bag of flour is pegged at K20,000. Where can a mere villager get that K20,000?” Mpakeni said.

Felix Stafford Wilson, an electronic gadgets seller said he thinks the rising prices of goods and services are a challenge that the government has found pleasure in “just observing”.

“Goods are becoming expensive on daily basis but there is no control on the part of government—they are just observing. At the rate we are moving, business has no future because you buy things today and sell at a cheaper price but when you go to get another set of goods, you realise they are expensive and are not affordable,” Wilson said.

Maria Nyondo, who runs a small boutique, said inflation has led to the loss of the already depleted business capital to household use.

“I have two children but the amount of money that my husband receives as salary and the money that I realise from this business are no longer enough for the family. If my husband was receiving enough money, it would be easy for us to provide for the family but that is not the case,” Nyondo said.

Consumer Association of Malawi (Cama) Executive Director, John Kapito, said basic commodities in Malawi have been turned into luxuries.

“We need to select among the basic commodities and be able to identify the only key ones that we can buy so that they help our families. The important thing at the moment is to be rude with promotions and buying unnecessary commodities,” Kapito said.

He said Cama has been calling for an audience with policymakers but they are unwilling to meet them.

“As times goes by, things will continue to bite, but we do not want to be rational. Our approach was to engage government on some of the things so that it knows the direction we want and at the end that process should be able to change a few things,” Kapito said.

Executive Director for Institute for Policy Interaction (IPI), Rafiq Hajat, said unless government finds the best economic solution to the kwacha downfall, the price increase of basic commodities shall continue to increase.

“It is going to be inevitable for basic prize of goods to be increasing and further the cost of transport, school fees, water, electricity, rent and everything will go up . Actually, we are on an inflation spiral of which there’s no end unless we have restored the stability of the kwacha,” Hajat said.

He said the Malawi Confederation of Chambers of Commerce and Industry (MCCCI), Economists Association of Malawi (Ecama) and Malawi Congress of Trade Union(MCTU) have made some attempts to advise government on how to control the inflation but government decided to pay a blind eye and deaf ear.

MCCCI President, Newton Kambala, said the economy is in bad shape and there is nothing that can be done to stop increasing of basic commodities and service.

“What we can stop is the economy getting worse and making sure that people work hard; people should stop stealing and government should listen to businesspeople; otherwise, things will continue getting bad,” Kambala said.

He said today, MCCCI will be meeting government officials in Lilongwe to discuss several issues surrounding the economy.

But Treasury Spokesperson, Nations Msowoya, said the public should not be looking at the depreciation of the kwacha in a negative way.

“Actually, if you compare it with Tanzania, they are changing US$1 to 2,000 shillings. So, do not fight inflation as an elephant roaming in a wrong place,” Msowoya said.

However, MCTU Secretary General, Pontius Kalichero, said the Union has written government to consider increasing salaries for civil servants.

“We are also appealing to the private sector to do the same. Workers in the country are facing tough time to live on the same wage. Despite writing government, we have also proposed to meet government and see what percentage they may increase the salaries,” Kalichero said.

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