Country FilesSouthCountry Profile 2014: MALAWI

Sat,21Apr2018

Posted on Tuesday, 04 February 2014 21:08

Country Profile 2014: MALAWI

Flag MalawiBanda’s Augean challenge

Initially welcomed as “a breath of fresh air” after her unexpected riseto power in 2012,President Joyce Banda will have to face the biggest fight of herpolitical life when she tries to renew her mandate in the elections due in May 2014.Thee mergence of a damaging corruption scandal in September 2013 cast
such a shadowof doubt on the honesty of those at the heart of her government that she herself now risks being tainted by association.

 

TABLE OF CONTENTS:

Top Malawian Companies

Top Malawian Banks


theafricareport-malawi-72dpiBanda’s Augean challenge

Civil servants were found with millions of kwacha tucked under their beds

Religious and traditional leaders opposed a review of homophobic laws

Initially welcomed as “a breath of fresh air” after her unexpected riseto power in 2012,President Joyce Banda will have to face the biggest fight of herpolitical life when she tries to renew her mandate in the elections due in May 2014.Thee mergence of a damaging corruption scandal in September 2013 cast
such a shadowof doubt on the honesty of those at the heart of her government that she herself now risks being tainted by association.


Prior to the latestcrisis,Bandahadassiduously built her reputation on taking the tough decisions that her predecessor, President Bingu wa Mutharika, had refused to contemplate. After Mutharika’s sudden death in April 2012, she reversed many of his economic policies and quickly devalued the Malawi kwacha, winning promises of substantial financial support from Western donors. To reduce waste in government spending she even sold off the presidential jet.

 

 

GAY RIGHTS AND ‘CASHGATE’

On the domestic front, however, herfresh approach did not always win favour. In particular, she was forced to flip-flop on the vexing issue of gay rights. Perhaps playing to the cameras for the benefit of the donor community, Banda had asked parliament to review the country’s extremely homophobic laws but the backlash was immediate. Religious and traditional leaders ganged up against her accusing her of pandering to “alien traditions of the West”. She backtracked and said she would leave the issue to
Malawians to decide.

Despite this upset, there seemed little chance that any other political camps might be strong enough to derail Banda’s run for power in the upcoming elections, mainly because of the poor record of both Mutharika and his predecessor, Bakili Muluzi, when in office. But the attempted assassination of a high officialon 13 September threatened to spoil the new president’s hitherto clean image. The official was the budget director Paul Mphwiyo, who had been trying to close loopholes used to pilfer government money, and evidence soon came to light of the extent and the high level of the corruption he sought to prevent.

As the so-called “cashgate” scandal unfolded, civil servants were found with millions of kwacha tucked under their beds or in their cars, having avoided the banks rather than explain the source of their cash. By mid-October at least 10 people had been arrested and Banda had dismissed both finance minister Ken Lipenga and justice minister Ralph Kasambara, who found themselves at the centre of the initial investigations. There were calls for Banda’s resignation as both opposition parties and civil rights activists accused the administration of presiding over rampant corruption.


DONORS SEND PROBES


Banda’s main defence, that she inherited a corrupt system and was determined to overhaul it, was widely questioned by sceptics. Donor representatives were taking no chances, with the EU asking for “credible” investigations before imminent due disbursements would be authorised, and both the EU and the UK offering assistance in a forensic auditing of government coffers.

The economic outlook is in any case gradually improving, with positive growth projections of 5% for 2013 and 6.1% for 2014, but the unavoidable surge in post-devaluation inflation has been slow to subside (the rate was still estimated at 26% in September 2013). The agricultural outlook was helped somewhat by improved farmers’ incomes from tobacco and maize, while manufacturers benefitted from the improved availability of fuel and easier access to foreign exchange.

Exports are dominated by tobacco, which earned the country $350m in the 2012-13 season–hardly enough to meet its fuel import costs.There are hopes that China will open up a substantial new market for the crop, which contributes to the incomes of 80% of Malawians. Other crops are tea, cotton, coffee and sugar.

The Kayelekera uranium mine hashelped to stimulate the small minerals sector, and exploration rights have been issued for rare earth elements like niobium. Preliminary indications that there could be oil under Lake Malawi have stirred a border dispute with Tanzania, but the President has said she will
not cede any part of the lake to Malawi’s neighbour and vowed to take the issue to the International Court of Justice.

 

Malawi's Top Companies

Rank 2012Rank 2011CompanySectorCountryTurnover (Thds $)Turnover changeNet profits
314311PRESS CORPORATIONDIVERSIFIEDMALAWI403,6144.15%20,849
498-ILLOVO MALAWIAGRIBUSINESSMALAWI207,1732.98%65,205
 

Malawi's Top Banks

 

Rank 2012Rank 2011Bank nameCountryTotal assetsNet interest incomeLoansDeposits
181169NATIONAL BANK OF MALAWIMALAWI553,57582,463279,904401,174
 


Subscriptions Digital EditionSubscriptions PrintEdition

FRONTLINE

NEWS

POLITICS

HEALTH

SPORTS

BUSINESS

SOCIETY

TECHNOLOGY

COLUMNISTS

Music & Film

SOAPBOX

Newsletters

Keep up to date with the latest from our network :

subscribe2

Connect with us