Peter Mutharika to address press conference Friday in reaction to devaluation of the kwacha

* He will be accompanied by senior members of the DPP to be covered live on a number of media houses from 10:00hrs

* The former Head of State is eyeing to contest again for the National Presidency under the DPP

* The Party which his brother and former Head of State, late Bingu wa Mutharika founded in 2009

By Duncan Mlanjira

Former President Peter Mutharika has announced that he would address a press conference on Friday in reaction to devaluation of the kwacha.

A statement from his spokesperson, Shadric Namalomba issued today, says he will be accompanied by senior members of the DPP to be covered live on a number of media houses from 10:00hrs.

Mutharika is eyeing to contest again for the National Presidency under the ticket the Democratic Progressive Party (DPP) which his brother and former Head of State, late Bingu wa Mutharika founded in 2009.

Soon after the re-alignment of the kwacha by the Reserve Bank of Malawi (RBM) on Wednesday last week, former Governor Dalitso Kabambe, who is also eyeing for the national presidency, posted on his Facebook profile, that “looking at the timing, this must be a prior conditionality for extended credit facility (ECF)” that Malawi is expected to be provided by the International Monetary Fund (IMF).

“The K1,700/US$ is still below the market equilibrium”, he said, adding that Malawians “should anticipate further depreciations”.

“Furthermore, this devaluation is just as reckless as the previous one given that fundamentals of the monetary policy stance remains helpless and fiscal consolidation is nonexistent.

“There will be no recovery from the macroeconomic meltdown. It will only make the suffering experienced by Malawians worse, as prices of basic goods such as fuel, fertilizer and food items, will soar,” he said while emphasizing: “Mark my words.”

Reacting to Kabambe’s analysis, Raymond Vic Fumbula asked the former RBM Governor to share insights with the authorities on how Malawians can come out of this mess as a country.

“Politics aside, combine efforts, bwana with the Minister of Finance and [President Lazarus Chakwera]. Please help the country Chief!” he asked Kabambe.

Kaweko Yona Chirwa was of the opinion that if Kabambe “has solutions to the economic problems facing the country”, he did not need to wait for 2025 to assist Malawians in the event he would be successful as leader of the country.

In the event that the DPP shall endorse Mutharika at the expense of Kabambe, Maxwell Kopa asked the former RBM Governor to consider contesting as independent, saying maybe he could bring change.

Meanwhile, at press conference that Minister of Finance & Economic Affairs, Simplex Chithyola Banda held today in Lilongwe to update Malawians the Action Plan that has been effected towards the recovery, development and protection of the economy in the aftermath of the devaluation of the kwacha, he unveiled some measures aimed at cushioning the most vulnerable Malawians from the economic shock the devaluation has caused.

In recognition of the possible adverse and un-intended effects of the re-alignment on some sections of the population, the Minister said government has already negotiated with development partners such as the World Bank and Multi Donor Trust Fund for adjustments to social cash transfer programs, which include:

* Continuation of the implementation of Cyclone Freddy recovery intervention in Blantyre Rural, Thyolo, Phalombe, Chiradzulu, Mulanje, Nsanje, Chikwawa, Balaka, and Zomba Rural targeting 184,920 households where beneficiary households receive K150,000 to support with consumption needs and cushion the affected households against the effects of the alignment;

* Re-introduce the price shock urban emergency cash transfer program which will target 105,000 households in Zomba, Blantyre, Mzuzu and Lilongwe city councils. Beneficiaries will receive a once-off transfer of K150,000 covering a period of 3 months;

* Increased social cash transfer benefit levels by 57% which is more than the exchange rate alignment amount. This is with immediate effect;

* Increased social cash transfer beneficiary coverage from the current 10% to 15% of the population — from 2 million to 3 million people;

* Pursuant to section 54 of the Employment Act (Cap. 55:01 of the Laws of Malawi), Government has embarked on consultations with relevant stakeholders to revise the minimum wage. The government will also embark on a similar exercise with respect to public servants.

* With support from development partners, Government has commenced the recruitment of 2,741 health workers, such as nurses, doctors, etc. The recruitment process is expected to be completed by 31st July 2024;

* Government is discussing with foreign governments on skilled labour export. Over 5,000 skilled professionals are expected to be recruited under this program. The country is also expected to significantly benefit in terms of foreign currency remittances/foreign currency diversification under this initiative;

* Increasing the wage rate for the climate smart public works programme (CSPWP). The public works wage wate will be adjusted upwards and announced in due course. Currently beneficiaries receive MK1,200 for 4 hours working day for 12 days a month. Furthermore, CSPWP beneficiary work period will be extended by having no breaks between cycles for six months in a year;

* The number of CSPWP beneficiary households has increased immediately from the current 362,450 to 520,000 household’s country wide;

* The climate smart public works program will now be extended to the City Councils to support the participants with their consumption needs. Participants will be engaged in selective works including tree planting;

* Government will immediately engage all Civil Service Trade Unions to review salaries in the public sector and determine how Civil servants can be properly cushioned against the alignment.

The Minister concluded that these are just a few of the aspects of the Action Plan and measures to cushion the vulnerable, but he will make other aspects known when he will present the Government’s Budget Review Statement to Parliament next week.