Malawi makes wise political decision, creates business tsunami

Malawi might have made a politically correct decision not to host next month’s African Union (AU) summit but for businessmen this is an investment tsunami.

“In short we’re very, very, very saddened and we don’t know what to do,” said Mike Mlombwa, CEO for Countrywide Car Hire and President of the Indigenous Business Association of Malawi (IBAM), Friday. “I am sure if we don’t play our cards properly maybe this can cause a collapse of some businesses in this country.”

Malawi’s decision not to host the summit may put the southern African country in the comfort zone with Western donor countries. The United States and Great Britain have made it clear there would be “consequences” for donor-recipient countries that host International Criminal Court (ICC) twice inducted suspected war criminal Sudanese President Omar Hassan al-Bashir. The US Congress actually passed a law asking Washington to cut off aid to any country that entertains al-Bashir.

So when the AU secretariat wrote the Malawi Government it has no right to dictate who attends the summit and who does not Lilongwe had a ready answer.

“While we have obligations to abide by decisions of the African Union we are also under obligation to other international agreements including the Rome Statute (that set up the ICC),” said Vice-President Khumbo Kachali in a special address to the nation Friday on state radio and television. “Malawi will not be hosting the African Union summit.”

Kachali, acting as President in the absence of President Joyce Banda currently on an official tour of Great Britain and the US, disclosed that the AU secretariat wrote the Malawi Government that it either allows all African leaders to attend the summit or it forgets it.

“The African Union Commission has informed the Government that as a host nation Malawi has an obligation to invite all heads of state and government, including President al Bashir of Sudan,” he said. “The African Union’s position is that if we are not willing to receive President al-Bashir they will move the summit out of Malawi.”

Khartoum wrote the AU Thursday that since Malawi does not want to host al-Bashir it should consider moving the summit from Lilongwe to its headquarters in Addis Ababa, Ethiopia.

Said Kachali: “Cabinet decided that it is not in the best interest of all Malawians to accept the condition put forward by the African Union Commission to receive President al Bashir. Cabinet therefore took a decision that Malawi will not be hosting the African Union summit and we have informed the African Commission.”

Kachali said Cabinet took this decision “with the primary consideration of what is in the best interest of Malawians”.

But certainly not in the interest of businessmen like Mlombwa. “The cancellation has affected us greatly because, as we’re talking now, as the Indigenous Business Association of Malawi president, I am receiving lots of calls, because everybody is mad, they don’t know what to do.”

Mlombwa said people in the hospitality industry like hotels and transport business invested a lot and took out “big loans” to spruce up their units and procure new fleets of vehicles in readiness for the summit.

“The saddest thing is that some countries and organisations paid deposits and most have already exhausted that money and now don’t know how to pay back that money,” he said.

Mlombwa himself said he applied for “a big loan” to beef up his fleet of vehicles. “We didn’t want to shame our country, we wanted all the visitors when they come to Malawi they shall use comfortable vehicles,” he said.

The Malawi Government and the AU secretariat placed advertisements in newspapers calling for people with “good houses” to lease them to the summit. “I had to repaint my house and took out a bank loan to buy new expensive furniture ready to lease my house for a month at a comfortable profit,” said a resident of Lilongwe’s upmarket suburb of Area 43. “Now this is all money down the drain.”

President Banda, who arrives in Washington Friday, is scheduled to hold talks with Secretary of State Hilary Clinton next week. Among the menu on the table is the resurrection of the US $350.7m Millennium Challenge Account (MCC) that the Obama administration suspended for Malawi because, among other reasons, Malawi’s decision to host al-Bashir in 2010.

“Joyce Banda couldn’t risk MCC for which she has worked so hard to resurrect,” said a diplomat in Lilongwe. “We were watching her every move.”