Malawi’s Hyperinflation Angers Opposition Party

By: Happy Soko

Malawi’s hyperinflation angers opposition party

…Government stealing from the poor

Opposition Umodzi Party (UP) has described the current negative economy as an indicator of incompetent Democratic Progressive Party under the leadership of Peter Mutharika.

Currently Malawi is experiencing the widespread economic weakness despite the 2015/2016 National budget being  pegged at MK901,6 billion with key allocations of MK133.7 billion to agriculture, MK109.8 billion to education, and MK77.4 billion to health sectors.

According to UP leader Professor John Chisi, it is only politicians and government Principal Secretaries (PS) and other civil servant getting richer while the poor continue to suffer. He said the money that government generates through taxes from the private sector only benefit civil servants, a situation that contributes inflation.

“Government generates more money from private sector and ordinary Malawians through duties. This money is raised from poor people who do not have anything. Politicians and civil servants benefit a lot than ordinary Malawian who makes the money,” Explained Chisi in an Interview with The Malawi Star.

He attributed the current economic crisis as due to the failure by government to make Malawi a suitable market place for investors.

Chisi blamed DPP government for taking advantage of the countries food disaster by distributing maize to its party members.

“Politicians cannot change their behavior because it’s the system they have created.  There is no maize in the country but DPP is distributing maize. They have deliberately created a political upheaval and they are benefiting from that. This means for the economy to move we need people that are independent of the government who can think of solving problems and creating jobs. Poverty will never be removed without creating jobs and Malawi will never move if companies are not being created,” added Chisi.

The countries 2015/16 budget constituted 26.2 percent of Gross Domestic Product (GDP), while the revised budget for Financial Year 2014/15 accounted for 28.4 percent of GDP.

However minister of finance and economic planning Goodall Gondwe said in 2015/16 Financial Year, the recurrent budget is MK674.6 billion while the development budget amount to K224.0 billion.

He said the decline in total revenue and grants as a share of GDP is entirely due to the continued decrease in donor grants, which amounted to MK132.8 billion in Financial Year 2014/15 causing more troubles for the country to cope.  

The development has made Malawi Revenue Authority (MRA) set out to strengthen the tax administration regime as a way of bounced back the economy from subdued growth.