PRESIDENT CHAKWERA GENUINELY TURNING AROUND MALAWI ECONOMY

PRESIDENT CHAKWERA GENUINELY TURNING AROUND MALAWI ECONOMY
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By Chikumbutso Mtumodzi 
LILONGWE, 23 August, 2021
INTRODUCTION


For decades, Malawi has been lagging behind many Sub-Sahara African countries on the United Nations (UN) Human Development Index (HDI). According to the United Nations Development Programme (UNDP), Malawi’s HDI value for 2019 was 0.483, which put the country in the ‘low human development’ category, positioning it at 174 out of 189 countries and territories. 


The HDI is a summary measure for assessing long-term progress in three basic dimensions of human development, which are ‘a long and healthy life’, ‘access to knowledge’, and ‘a decent standard of living’.


NEW AND BETTER MALAWI FOR ALL
Malawi is ranked among the world’s least developed countries. It is against thisbackdrop that President Lazarus Chakwera promised on his inauguration as sixth President of the Republic of Malawi on 6th July, 2020 that the Malawi Congress Party (MCP) government’s major preoccupation will be to change this status quo. 

The President has been resolute about building a better Malawi than what the previous administrations have offered over the past two and half decades ago.Previous administrations promised prosperity but delivered poverty; nationalism but delivered division; political tolerance but delivered human rights abuses; good governance but delivered corruption; and promised institutional autonomy but delivering state capture, President Chakwera has said.


At the onset of his administration, President Chakwera made a solemn pledge to Malawians that he would transact business ‘unusual’, laying emphasis on vigorously dealing with previous misrule and economic mismanagement, including fighting corruption and theft of public resources. 


A renowned servant leader, President Chakwera has always been alive to what Malawians have long desired, which is a government that facilitates balanced and equitable development, a government, which ensures dignity for all, guarantees better income, provides jobs, especially for the youth, and a government that contributes to building confidence, promoting stability and ensuring integration into professional, social and family life.
President Chakwera has gone into full gear, initiating and implementing governance and economic reforms that would permanently improve the living standards of Malawians. President Chakwera has said his government would focus on programmes with impact to achieve permanent food security, create jobs for the youth, and create wealth for all, through the attainment of a robust, inclusive and resilient economic growth, economic empowerment, and infrastructure development.


ACTUALIZING PRESIDENT CHAKWERA’S VISION


In quest of achieving a well-coordinated path to social and economic recovery and development, the Chakwera administration recently launched the national development blueprint, the Malawi Vision 2063 (MV2063), to transform Malawi into “an inclusively wealthy and self-reliant industrialised upper-middle-income nation”, by 2063. Malawi’s Finance Minister Felix Mlusu has said the 2021/2022 National Budget contains sectoral allocations, which are in line with the long-term aspirations of the nation as contained in the Malawi 2063 blueprint.


The Covid-19 pandemic has had a huge impact on every sector of the economy butthe Chakwera administration is not obstructed from the social and economic development policies and reforms that it has initiated and set out to implement to raise people’s living standards in short, medium and long term.


SHORT AND MEDIUM TERM INTERVENTIONS
Some of the important short and medium term steps that the Chakwera administration is taking to foster growth and improve people’s living standards are worthy highlighting.
According to the Finance Minister, the government has enhanced the operations of National Economic Empower Fund (NEEF) to economically empower Malawians, especially the youth and women, through job creation, enhancement of entrepreneurial activities, and to support agricultural productivity and value addition.Fair distribution of national wealth can create employment and enhance business activities, thereby enhancing social and economic development. It is thegovernment’s wish that as many Malawians as possible access National Economic Empowerment Fund (NEEF) loans to start various businesses and improve their families living standards.President Chakwera has, however, issued a stern warning against politicization of the loans as the case was under the previous regimes.


GOVERNMENT TO PRIORITIZE LOCAL BUSINESSES


The Office of President and Government (OPC) has actualized a presidential order that all government Ministries, Departments and Agencies (MDAs) must give preference to Malawi Micro, Small and Medium Enterprises (MSMEs) in public procurement of goods, works, and services. It does not get better than this for local entrepreneurs.
The MSMEs will be required to be registered as business entities and are also registered with the Malawi Revenue Authority (MRA). The MCP Government is committed to empowering the informal sector entrepreneurs through the establishment of cooperatives and skills development to enable them produce quality products for the local and export market.


TAXES AND CREATING WEALTH
How a government enacts and implements tax reforms can make or unmake the national economy.Taxes have a significant impact on economic growth of any country because it is the revenue from taxes that determines the extent to which government would provide social services and create economic opportunities for the people through various programmes. 
One of the most important steps to promote fair distribution of wealth and increase disposable income for low income earners has been the introduction of two new ‘Pay As You Earn’ (PAYE) brackets of 25 percent for incomes between K100,000 to K1.0 million per month and of 40 percent for incomes of more than K6.0 million per month. 


The new monthly PAYE schedule is now K0 to K100,000 at 0 percent, between K100,000 to K1.0 million at 25 percent, between K1.0 million to K3.0 million at 30 percent, between K3.0 million to K6.0 million at 35 percent, and from K6.0 million and above at 40 percent. The Chakwera administration is also implementing tax reforms that are aimed at boosting the growth of small businesses and to reinvigorate the economy, especiallyin the wake of Covid-19 pandemic. The government recently introduced a duty-free week for imports not exceeding US$3,000 for taxpayers once a year.


Additionally, to support growth of small businesses, the government decided toincrease the COMESA Simplified Trade Regime threshold from US$2,000 to US$3,000. This is a trade arrangement, which allows cross border traders in COMESA region to enjoy duty free status when they import goods originating from other member states. The decision meant that small businesses are now allowed to import qualifying items valued up to US$3,000 without paying import duty. The government has also removed import Value Added Tax (VAT) on raw materials for use in manufacturing of medicaments, pharmaceuticals and medical apparatus; and raw materials for use in printing and publishing books. According to the Minister of Finance, by subjecting the raw materials for producing them to VAT, the local producers were not able to claim input VAT, which was eventually being transferred to the consumers thereby making them expensive and uncompetitive compared to similar imported products.


IMPROVED SOCIAL CASH TRANSFER PROGRAMME 
The MCP government is also implementing various aspects of Social Cash Transfer Programme. The number of beneficiaries has been increased by five (5) percent while the amounts transferred to beneficiaries has also been raised from K7,000 per household per month to K9,000.


FREE ELECTRICITY AND WATER CONNECTIONS 
President Chakwera also realizes that providing Malawians with clean drinking water and electricity can substantially improve their living standards. This is the reason government is in the process of actualizing the campaign promise of free electricity and water connections. 
The Ministry of Energy reportedly completed drafting of the Free Electricity Connection Policy a few months ago, which will provide a platform for free connections to individuals and public institutions in the rural and peri-urban areas. 
Under this arrangement, connection fees, which averages K17,500 will completely be removed. A similar process will be done for free water connections. 
BETTER HOUSES FOR MEN AND WOMEN IN UNIFORM
For many years, army, police, immigration and prison officers in Malawi have lived in poor houses. President Chakwera and the MCP government are keen to improve the living standards of the country’s security officers by providing them with decent accommodation as an incentive so that they serve the nation better and for their own safety.
President Chakwera has emphasized that Malawi cannot record significant social and economic development without attracting foreign direct investment (FDI). However, that investment can only come if safety and national security are guaranteed. That guarantee can only come if security officers and their families live in better houses dilapidated and tiny houses or in rented houses in the midst of civilians and criminals, risking their own and families’ safety.
Therefore, a project to construct 10,000 houses for security institutions hascommenced. Over 200 houses are currently under construction in various sites.
Financing for this project is through a long term development bond that was issued by Government and raised the initial amount of K21.0 billion.


CONCLUSION
There are other efforts being undertaken to improve the economy in other sectors such as agriculture and irrigation, water and energy, education, health, transport, communication, infrastructure development, tourism, mining, trade, industry, and manufacturing, among others. With the prevalent political will at the highest level, Malawians should expect that these efforts will bear fruits but only if and when all Malawians contribute their talent, skills and abilities useful for development.
People are the most important resource in the quest for social and economic development of a nation and, it is, therefore, crucial for all Malawians, irrespective of politics, religion, tribal and regional extraction, to support President Chakwera and his administration turn around Malawi’s economic fortunes

Malawi Exclusive

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        هنگامی که ربات ها به طور عاقلانه استفاده
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