Devaluation of the Kwacha & more – 5th Oct 2023

Muli bwanji from BA! This is the Rorshok Malawi Update from the 5th of October twenty twenty-three A quick summary of what's going down in Malawi.

The Reserve Bank of Malawi held a foreign exchange auction last Wednesday, on the 27th. This resulted in a 5% depreciation of the Kwacha. This means that the exchange rate stands at one thousand one hundred and eighty Kwacha per dollar, up from one thousand one hundred and twenty-six Kwacha.

This is the fourth Kwacha depreciation this year alone. While the Reserve Bank is devaluing the the national currency in small amounts, the impact on society is quite heavy, since people have to pay a little more for basic goods, such as cooking oil and sugar.

Speaking of fuel, the country is facing yet another shortage, but this time, it has caused what is arguably the worst traffic in Malawi so far. Most roads in Blantyre, Zomba, and Lilongwe are impassable since motorists have been queueing for fuel on the main roads, causing traffic and blockages.

In Blantyre, trips across the city that would take around thirty minutes are now two or more hours long.

Some drivers have slept at fuel stations for more than three days, in hopes that a fuel tanker will show up.

The scarcity has also forced some motorists to buy fuel on the black market, for around five thousand Kwacha per liter, or roughly four dollars, while the previous rate was a little over fifteen hundred Kwacha, or a bit over a dollar.

When there's a fuel shortage minibusses are also forced to buy fuel on the black market to stay in business, which makes transport fares go up. Since black market fuel is more expensive, to make up for that extra charge on fuel, transport fares are increased, and buses still make profits.

For instance, local media reported that a trip from Blantyre to Zomba is now six thousand Kwacha - about five dollars, up from three thousand Kwacha, or three dollars.

Locals who cannot afford the new transport fares are being forced to walk home or hike – both of which are a risk to their safety, given the recent spate of criminal activities in major cities.

There are fears that the fuel scarcity might get worse.

On Wednesday the 4th, Mphatso Molleni, the Chairperson of the Truck Drivers Association of Malawi, told local media that, starting from the 18th of October, truck drivers would go on strike since the government isn’t fixing their problems.

Molleni outlined that they had asked the government to increase their allowances, especially for overtime shifts. However, the government has not fulfilled the Association’s demand. Molleni threatened that the Association would go as far as not allowing foreign truck drivers to import their goods into Malawi.

But you know what’s interesting? The country usually experiences the worst of its fuel shortages when President Chakwera travels. There is a common belief that this happens because the President uses forex for his travel expenses—allowances included, depleting the reserves that are meant for fuel. Recall that the origin of the fuel scarcity is forex shortage.

President Chakwera was at the 78th United Nations General Assembly. He left on the 15th of September and only returned on Monday the 2nd. He had thirty-five delegates with him.

Hopewell Chin’ono, a Zimbabwean award-winning journalist, called Chakwera “a real joke” on Twitter on Saturday the 30th after the Malawi government released a statement announcing the president’s return to Malawi.

Chin’ono’s tweet also read: “Seventeen days of him and his team collecting daily allowances and paying hotel bills from one of the poorest countries in the world!”

But Malawians took it a step further and booed at the President’s convoy while he was coming from the funeral of prominent politician John Tembo, who died last week.

On Wednesday the 4th, President Chakwera was in Kaphala village in Dedza district, where Tembo’s remains were laid to rest. While making his way home to Lilongwe from the funeral, bystanders started booing at him, demanding that he give them fuel. Others shouted profanities at him, while others asked where he was getting fuel for his convoy.

The President’s trip was called into question on social media as he might have been selfish amidst the fuel shortage Malawi is going through.

In other news, according to an article by Business Insider Africa published on Sunday the 1st, from June to September twenty twenty-three, Malawi had the lowest data prices in Africa and ranked twenty-nine globally.

The article says that the countries listed in their top ten have cheap data due to factors such as fierce competition in the telecommunications industry and solid infrastructure investments. Interestingly, experts agree that Malawi has neither. In fact, recent studies by top digital researchers such as Jimmy Kainja prove that Malawi is lagging behind in terms of digital advancement since there hasn’t been much investment on this front, which leads to high costs of data.

Over two hundred Malawians are bound to lose their jobs.

On Sunday the 1st, the Malawi Post Corporation said the company would let go of over one hundred employees because they needed to cut costs.

Idah Nkolimbo, the Spokesperson for the Corporation, told local media that the affected employees will receive a three-month notice, their severance pay, funds from their unused paid leave days, and their other benefits. She said they will also receive transport from their duty stations to their homes.

On Tuesday the 3rd, another company—Central Poultry—will also be letting go of over one hundred employees.

Yaseen Kasmani, the Executive Director for Central Poultry, said the company is facing financial setbacks and is not making healthy profits. He believes this is the only way to stay afloat given Malawi’s tough economic situation.

Furthermore, Malawi’s unemployment rate is at 91%, and such news does not give hope to job seekers.

Now onto entertainment news… The country is celebrating an actress, Mwai Simbota, for winning the Best Actress Award in Feature Film Southern Africa at the SOTAMBE Festival, held in Zambia. Simbota won the award for her performance in a Malawian movie called Misnomer, where she played the role of Cecilia, an Interpol officer who was hunting for the killers of some people with albinism.

This is Simbota’s second win. Last year, she won the Best Actress award from the Film Association of Malawi.

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Fans who were expecting to watch musician Jay Jay Cee perform this weekend will have to wait a little longer.

Jay Jay Cee was supposed to launch his album Pamodzi, which means together, this Saturday the 7th at Robin’s Park in Blantyre. However, since the Blantyre City Arts and Culture Festival will take place on the same day at Kamuzu Stadium, Jay Jay Cee’s management announced that they had pushed the album launch to the 4th of November.

Speaking of the Blantyre Arts Festival, it is free of charge. While it typically runs for three days, this year, the festival will only run for a day – on Saturday the 7th from 7 AM till 5 PM. There will be performances from artists such as Tay Grin, Driemo, and Skeffa Chimoto.

The theme for this year’s festival is “Celebrating Arts, Culture and Unity to Promote Participatory Municipal Management”.

On that note about festivals, if your phone was stolen at the just-ended Sand Music Festival that took place last weekend from Friday the 29th to Sunday the 1st, you might get it back.

Mangochi Police announced that they are keeping five men for suspected mobile phone robberies at the festival.

On Monday the 2nd, the owner of the rest-house they were lodging at got suspicious because the men had not returned for their car. He called the police and upon arrival, they searched their room and found twenty mobile phones.

Mangochi Police Station has since advised those with missing phones to report to the station to identify their mobile phones.

That’s it for this week! Thanks for joining us!

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Pitani bwino!