The last few weeks have not been particularly great for the government of Malawi. The nuts and bolts of their fixes seem to be in the habit of falling off. And despite some efforts to try to guide the economy back into the green, it appears that the economic situation is about to get a lot worse.
Things in Malawi rarely work according to plan. Lets see, the last few weeks, speculation on social media have been dominated by talk of infighting within DPP’s top ranks. I know from a reliable source that this is true. Then came Nankhumwa, who always seems to be able to say the wrong things (a statement had top be made distancing the government from his claims). Last Friday this trend took a different but equally crushing turn, when the Mail & Guardian carried a story that a number of the Malawian nationals who were victims of xenophobia in South Africa, and who were repatriated at government cost (to the tune of R5 million), are thinking of returning to South Africa. The writer, one Lameck Masina calls these people ‘Refugees‘ and claims that 70 Malawians have already been stopped at border posts trying to get back into South Africa. The article quotes one ‘returnee’ to have said
“They promised to put us into technical colleges to learn entrepreneurial skills and give us capital and equipment to start businesses,”
“When we arrived in Blantyre we were given money for transport home, a blanket and a plastic bucket. Nobody talked about skills training.”
Which leaves one wondering, what was the point of the whole thing?
Surely the officials who came up with the idea couldn’t have proposed a half-cooked PR stunt staged for the purely selfish reason of political capital? No, they couldnt have. Surely, the government was trying to help Malawians in South Africa, and they must have figured it out,including allocating funds. Some people must have sat down and crunched some numbers and come up with a workable strategy of what to do with the 3200 repatriated nationals once they returned into the country,and how best to help them resettle? If the talk of technical training is anything to go by, someone must have told those repatriated about it?
But sadly, it appears that either the memo got lost in the red-tape of protocol, or that the issue of resettlement program never came up. It looks like it wasn’t entirely figured out, which probably means the government thought once home the Malawians would just get on with it.
The government has said in the past that unemployment in Malawi will be tackled through a community college initiative President Peter Mutharika launched in March, which seeks to train rural youths in entrepreneurial skills with the aim of making them self-sufficient, but it doesn’t appear like the details of such were communicated to the returnees. No surprises then that some people I have talked to have dismissed the whole thing as obfuscatiory posturing to launder the tattered reputation of the government.
But that issue aside, what of the Malawi Savings Bank (MSB) sale?
Seriously, have we sunk so low that even shady government intentions have to be so soft a target as to attract the criticism of foreign emissaries? Wasn’t there anyone in the initial deliberations regarding MSB who could have prevented what is now becoming an unnecessary public embarrassment? You ask how? Well, by going after the defaulters assets before any talk of a sale came to the fore. You’d have thought President Peter Mutharika’s advisers would have told him all this behind closed doors. It shouldnt have got to the point of demonstrations, to the point where Leston Mulli goes out publicly to say the loans his company received during the Bingu era were mostly channeled back to DPP.
While such practices are questionable (if not clearly corrupt), and while the matter should be referred to the anti-corruption bureau (although I wouldn’t bet a finger-nail on it), such dirty laundry gives the government a bad name. Things shouldn’t have to get to such a stage.
The government needs advisers who can alert them against bad decision-making. Nowhere has the bailing out a failed bank not been a messy affair.
In the UK for example, in 2009, you had a situation in which banks which had lost billions due to excessive risk-taking (causing a credit crunch), had to be bailed out by the tax payer to the tune of £80billion. This then partly justified an argument on the part of the conservative government to institute deep cuts to public services (cuts which funny enough didn’t affect those who caused the crash. But instead affected people with disabilities, the poor, the unemployed, and the vulnerable more than anyone else). In the end, the bankers continued to give out generous bonuses to their top advisers as this story titled ‘The RBS Bonus Scandal: How the government and the banking industry are living in a fantasy land ‘ neatly outlines.
Contrast that scenario with Iceland, which let the banks fail (attracting visceral criticism from some across Europe). The Icelandic banks may have been mainly private banks (whereas MSB is a public owned bank), but you can argue that the same principles could apply, even though Iceland protected state finances by continuing social support programs.
In the MSB case, selling the bank without confiscating and liquidating the assets of its defaulters would amount to backdoor extortion. Something akin to what John Wight describes in relation to Britain in his aricle titled ‘The Board of HSBC Should Be Arrested and the Bank Taken Into Public Ownership‘, when he says:
“..With the advent of the worst economic crisis since the 1930s, caused by the greed and recklessness of the banks, the government has effected the transference of wealth from the poor to the rich under the rubric of austerity, a process measured in food banks, payday loans, benefit sanctions, the bedroom tax, and zero hours contracts at one end of the social and economic spectrum, alongside an increase in the wealth of the country’s 1000 richest people over the same period.”
Cause, and effect.
Anyhow, on top of the drama unfolding in Malawi, imagine how the sentiments will be at State House when the budget delivered on Friday (which unsurprisingly was praised by the usual suspects) ends up being described as pro-Rich? As a budget which will hurt the poor…Well, that’s what many CSO’s in Malawi have said.
You have to pinch yourself sometimes, when you see illogical, and clearly erroneous decision-making. Do these people live in the same world? Or are they spellbound by a version of reality which doesn’t relate in any way to the guy on the street? The people they represent….Isn’t it just yesterday we were wondering what the next thing to fall through the roof at State House would be? The cash filled envelopes went up in flames. There has been no success with prosecution of Cashgate suspects up until now, more than a year into APM’s administration. National Aids Commission (NAC) continues to court controversy, even after its main source of funding was axed. Comments from Nankhumwa on the purchase of a new jet were roundly criticised. It seems everything this government chooses to touch goes pear shaped.
This festering sore of bad decisions at the heart of government has gone on too long. If you remember correctly it finds its roots all the way to Muluzi’s first administration in 1994. When the likes of Mpasu and Lemani were running roughshod (we all know what happened to them). And so, for not wanting to be branded a prophet of doom, allow me to offer some free solutions in my next post.