MALAWI: Devaluation & more – 21st Mar 2024

Muli bwanji from BA! This is the Rorshok Malawi Update from the 21st of March twenty twenty-four. A quick summary of what's going down in Malawi.

The Reserve Bank devalued the Kwacha by three percent. The statement was dated Tuesday the 19th, but it only came out on the night of Wednesday the 20th. Wilson Banda, the Central Bank’s Governor, signed it.

The statement said that the Reserve Bank had held a foreign exchange auction with local banks on Monday the 18th, where it decided to devalue the Kwacha.

The devaluation came into effect on Thursday the 21st. The exchange rate now stands at one dollar per 1,751 Kwacha, up from 1,700.

This seems like a small change, but for most Malawians, it is a cause for concern as they are already struggling under the current economy.

Afrobarometer - a non-partisan survey research network - released a new report titled Amid Economic Gloom, Few Malawians Hold Hope for Improvement. It shows that nine out of ten Malawians believe the Tonse Alliance ruling government has done a terrible job managing the economy, especially in light of the worsening poverty and unemployment levels. The study further indicated that eighty-nine percent of the respondents believe the economy is going in the wrong direction; sixteen percent think things would get better within the next twelve months, while sixty-three percent expect things to get worse during that same period.

In another Afrobarometer survey, thirty-seven percent out of 1,200 people said they experienced high-level poverty, and thirty-eight percent felt they had endured moderate poverty. Only four percent said they weren’t poor, meaning they had access to food, clean water, medical care, cooking oil and cash or income. A staggering seventy-four percent of the surveyed citizens feel their living conditions are bad.

These surveys by Afrobarometer coincide with a recent study by the World Bank, which found that one in three Malawians is depressed due to worsening poverty and financial woes. The biannual Malawi Economic Monitor report found that half of their respondents were severely food insecure, according to the Food Insecurity Experience Scale. Half of the respondents who were food insecure also exhibited symptoms of depression, whereas among those who were food secure, only one in five was depressed.

These findings make sense because, in twenty twenty-three, the Malawi Police Service said the annual suicide rate had gone up to 366 cases from 269 in twenty twenty-two.

On Tuesday the 19th, the Malawi Revenue Authority (or MRA) announced an increase in the duty for used clothes to two dollars and fifty cents per kilogram from a dollar and ninety cents. However, vendors who sell used clothes, or kaunjika, did not take this news very well.

Mind you, most kaunjika vendors buy kaunjika bales that weigh fifty kilograms and over. Most who purchase bales that weigh less do so because they are trying to get into the business, or because their previous bale did not break even or make a profit.

On Wednesday the 20th, kaunjika vendors from Tsoka Market in Lilongwe did not show up to work. Instead, they stormed the MRA offices demanding that they reduce taxes on kaunjika bales. They came in large numbers, chanting different songs and carrying placards. Local news said some vendors from Blantyre did the same too. They felt that they had to pay a lot of taxes to the government but did not reap the benefits.

The demonstrations served them well because later that day, the MRA withdrew its decision to raise the duty for kaunjika. Their statement admitted that their decision was a result of the massive demonstrations that the vendors from Blantyre and Lilongwe held against them.

Kaunjika is Malawi’s most affordable clothing option. If MRA had not recalled its decision, it may have led to mass demonstrations.

On Monday the 18th, a BBC Africa Eye documentary revealed that Malawian women are being trafficked to Oman through a seven-minute video snippet shared on social media. The caption said that most of these women are lured to Oman due to offers of domestic work, only to find themselves living as modern-day slaves.

The documentary, titled Trapped in Oman is available on YouTube. The link is in our show notes. But please be warned; it includes sensitive content.

Still on videos, but on a more positive note, video footage that trended recently on Facebook shows that some locals refuse to let their troubles get to them. In the video, a church choir was singing their songs on a roadblock. The details are unclear, but rumors have it that some Road Traffic Officers stopped the choir’s vehicle as they were on their way to minister at an unknown location. In most cases, road traffic officers will not release you if they find you on the wrong side of traffic rules unless you pay a penalty, so the choir might not have paid the fine.

The choir decided to minister right there on the road traffic block. Their acapella singing caught a lot of people’s attention.

In more bizarre and ironic news, a truck belonging to the Department of Disaster Management Affairs had an accident. It happened at Lungwena Bridge in Mangochi district on Sunday the 17th, after a Freightliner truck carrying six hundred bags of maize flour tried to cross the wooden bridge.

Amina Tepani Daudi, the Mangochi Police Spokesperson, said the truck driver was driving from Mangochi towards Makanjira Road. When the truck was halfway across the bridge, its pillars broke, causing a significant part of the bridge to collapse, twisting and dragging the truck’s trailer down as well. Some bags of flour fell into the river, but luckily, the front of the truck remained on the bridge, so it wasn’t affected.

A local paper said that Malawi is the third largest exporter of macadamia nuts in Africa, after South Africa and Kenya. It ranks number seven globally.

It also said Malawi exports about seventeen thousand metric tonnes of macadamia nuts every year. This contributes about forty billion Kwacha, or approximately 240 million dollars, to the country’s annual export earnings. But macadamias still have a long way to go to catch up with tobacco, which earned Malawi over 280 million dollars in exports last year.

A new contender may also be on its way. On Thursday the 21st, the Parliament gave Peter Dimba, the Lilongwe South Member of Parliament, permission to put forward a bill that two MPs presented to him anonymously to legalize the production of local varieties of cannabis or chamba. A lot of MPs supported Dimba’s move because they believed chamba was a cash crop that could bring fortunes in the form of foreign exchange.

Malawian cannabis has a strain called Malawi Gold that is internationally renowned as one of the finest sativa strains from Africa.

However, Richard Chimwendo Banda, another member of parliament, warned the other members, saying the legalization of chamba could have negative effects on society. But, Christine Mphande, another member, said Malawians have always grown it despite its illegal status, so the government might as well legalize and export it and establish regulations to avoid its abuse.

And to close this edition, some entertainment news. Harlan Steinberger, a USA Producer, left the country on Wednesday the 20th after recording eighteen songs over ten days at Jacaranda Studios in Blantyre.

Harlan is popular for flying in from his Los Angeles studio and working with local artists. Most recently, he recorded Keturah’s self-titled album. We are yet to find out who he worked with this time , but we know local producers Blessings Gondwe and Dan Khoviwa supported him during the recordings.

Harlan said they plan to make their first release in November.

And that’s it for this week!

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Pitani bwino!