Chakwera defends decision to migrate SOE’s bank accounts from commercial banks to RBM

* The President already explained in his SONA that the decision was to stop the government from borrowing its own money from commercial banks

*  It is fundamentally and morally wrong to continue this policy of allowing a few entities to control the wealth of Malawians for their own self-enrichment

Sheminah Nkhoma & Sellah Singini, MANA

President Lazarus Chakwera says his administration is committed to ensuring that state-owned enterprises (SOEs) are part of a wider reform agenda of the parastatal sector.


He was speaking in Parliament on Wednesday when he appeared before the house to respond to questions from the legislators and among them was why Chakwera’s administration has moved 22 accounts of SOEs to the RBM — though the President already explained in his State of the Nation Address (SONA) that the decision was to stop the government from borrowing its own money from commercial banks.

Chakwera maintained that the migration of SOEs’ bank accounts to RBM is one of the areas to reform the parastatal sector and emphasized that the government will continue with the migration policy to include fully sub-vented organisations and commercial SOEs.

“The migration process is done in phases to minimise instances of disrupting operations, which can affect the quality and speed of service delivery to Malawians,” he said.

“It is fundamentally and morally wrong to continue this policy of allowing a few entities to control the wealth of Malawians for their own self-enrichment.”

The President also addressed the house on measures his administration has put in place to cover the expected shortfall and timely avert a prolonged hunger crisis because of the dry spell the country is currently experiencing.

While some parts are experiencing dry spells, others are flourishing

He added that said his administration is conducting an assessment to establish the extent and impact of the dry spells.

“My government, with support from development partners, is implementing three flagship irrigation projects, namely the Agricultural Infrastructure & Youth Agribusiness project, Programme for Rural Irrigation Development, the Shire Valley Transformation Programme and the Agricultural Commercialisation project,” he said.

Meanwhile, the Ombudsman, Grace Malera has asked the government to consider reprogramming the affordable input programme (AIP), saying it has for years failed to make the country food secure.

Malera said this in Dowa when she presented the final report on systemic investigations on AIP implementation from the 2022 to 2024 growing seasons, saying there has been some improvements in AIP implementation, among them good political will and programming at the technical level, which, she said, has increased yields at the household level.

Ombudsman Grace Malera

“Although there have been some improvements, there are still some maladministrations that weaken the overall efficiency and effectiveness of the programme,” she said. “For instance, corruption and unethical conduct by stakeholders involved in the programme.”

Malera stated that AIP comes at a huge cost, and the cost-benefit analysis does not reflect the billions spent in the implementation of the programme — hence the call for the government to reprogram and rethink the programme.

The Office of the Ombudsman has recommended that, among others, in the long term, the government must continue putting on its agenda an exit strategy for AIP, and in the processing of graduation from AIP, there must be mechanisms for mitigating vulnerability in certain categories.

“In the short term, there should be fundamental remodelling of the subsidy programs, to optimise efficiencies, effectiveness and responsiveness to fit into the MW2063 goals,” she said.

The national AIP coordinator in the Ministry of Agriculture, Justin Kagona said the government has already started reprogramming and improving the programme to ensure that beneficiaries are assisted: “We have been reducing the number of beneficiaries from 3.8 million in 2020–2021 to 1.5 million in 2022–2023. This shows that the government is modifying and improving AIP.

“While we are reducing the number of AIP beneficiaries, we are increasing commercial production like mega farms, agriculture commercialisation, and the provision of loans to commercial farmers under the Nation Economic Empowerment Fund (NEEF) to achieve food security.”

In his SONA during the opening of the 2024/2025 National Budget session, President Chakwera said his administration is committed to redesign AIP to make it more targeted on those who are able to achieve food security with it.

The programme targeted 1.5 million farmers, with land holding sizes of 0.25 hectares to two hectares, to benefit in the 2023/2024 growing season and are expected to produce 1,125,000 metric tonnes, contributing to over 32% of the national grain requirement.

On Tuesday, Minister of Information & Digitalisation, Moses Kunkuyu said government has put in place interventions on the current food insecurity situation — implemented through maize distribution and cash transfers.

At a press briefing in Lilongwe on the status of the 2023/2024 lean season food insecurity response programme (LSFIRP) Kunkuyu announced that Malawi vulnerability assessment committee (MVAC) 2023 report indicated that 4.4 million people will be food insecure and in need of food assistance during the 2023/2024 consumption year.

“In response to the projection, government, through the Department of Disaster Management Affairs (DoDMA) and in collaboration with humanitarian partners, facilitated development of the 2023/2024 LS-FIRP to mobilise resources and effectively coordinate the programme to address needs of food insecure people,” Kunkuyu said.

The exercise, which started in October 2023, has so far reached out to 4,375,448 food insecure people with either maize or cash and DoDMA Commissioner, Charles Kalemba said they are working hard to ensure deserving beneficiaries are reached out with either maize or cash.

Minister Kunkuyu at the press briefing

Meanwhile, Kunkuyu emphasised the need for Malawi to graduate from financing subsistence farming to agricultural commercialisation if the country is to attain the much needed food security at national level.

He said the country is going towards that direction through provision of agriculture loans to farmers, as well as establishment of mega farms.

“We are now giving agricultural loans to farmers through NEEF,” he said. “These were farmers who were benefitting from the agricultural inputs programme (AIP).”

He added that the AIP is undergoing reforms and, as such, the number of beneficiaries keep changing in order to allow farmers graduate from subsistence to commercial farmers.—Additional reporting by Tabbu Kitta Kauye, MANA & Maravi Express