President Mutharika credits his administration for the stable economy
President Peter Mutharika of Malawi is projecting a 6 percent economic growth in 2018. He credits his government for transforming the country’s economy into stability since he assumed office back in 2014. The president attributed his projection to a stable macroeconomic space despite donor funding warning. Talking to Zodiak television, the president was categorical that he had managed to increase import cover foreign reserves to five months from the one month state he had inherited from his predecessor, Joyce Banda. He added that this is the highest period cover that Malawi has ever had.
Mutharika was also keen to express pride for the growing Malawian economy with a stabilized Kwacha over the year. He noted the many construction projects happening all over the country and increased employment opportunities for both skilled and unskilled people and service providers. These, according to him are indicators of the vibrant economy. Inflation which is at 7.7 percent, single digits is also falling. Further, the country’s policy rates currently at 16 percent are dropping almost setting a new record and an impressive import record, the highest in the nation. Interest rates have also decreased.
The president revealed that when he assumed office, the country had accumulated debts of up to K550 billion, equivalent to about a total budget; nevertheless, he has managed even without donor funds. The debts have now been paid to leave a balance of about K150 billion only.
However, according to Chancellor College-based social and political analyst Ernest Thindwa, the positive economic changes over the past twelve months have not reflected in the lives of poor Malawians. Thindwa noted that economic stability was only positively impacting on the corporate world due to lending rates reduction but not to the ordinary Malawian. President Mutharika was quick in his defense saying that it would take time for the average person to see the difference, especially with stable prices. The president promised to create more employment opportunities citing projects such as the Chinese Hotels in Lilongwe and Blantyre.
Critics have pointed out that the 200 megawatts production was less compared to the 350 megawatts of power production installed. This has caused a power crisis hence cutting on would be expected economic gains margin in the stabilizing macroeconomy. The critics concluded that power insufficiency was the most significant social and economic threat in Malawi. Thindwa who also supported this argument said that blackouts experienced in the country had cost it a great deal which would remain unrecovered.
The Governor also noted that the president and his administration were not keen in fighting the corruption menace, which even a threat to prosperity. The government is reluctant to deal with corruption perpetrators. The president was also accused of nepotism which he vehemently denied.