Malawi opposition People’s Progressive Movement (PPM) president Mark Katsonga, has slammed the government for introducing Automatic Price Mechanism (APM) and has since asked it to abandon the policy altogether.
Katsonga said this on Thursday in Blantyre at a press briefing his party organised to deliver what he termed a reflection of 2012 and forecast of 2013.
“This mechanism works well in developed countries with a strong currency. Unfortunately, regardless of the high poverty levels in the country, it was introduced in Malawi to make all products and services very expensive.
“PPM wishes to reiterate that [this system] has had an adverse effect on commodity prices resulting in very high inflation, which is taking the small disposable income from the stagnant salaries, creating extreme hardships to the citizens both in villages and cities without exception,” said Katsonga.
Under the APM, a fuel pricing committee comprising Malawi Energy Regulatory Authority, fuel retailers and other stakeholders meet once a month to determine new fuel prices according to trends on the market.
However, there have been monthly increases of fuel for the past five months with petrol price rising from K290 per litre to K606 a litre, resulting in frequent increases of prices of goods and services.
Katsonga also said the International Monetary Fund (IMF), which asked for this as a component in the extended credit facility, should also be informed that the system is being hampered by a weak currency and a debilitating poverty profile
On another issue, Katsonga also urged the government to refer all compensation cases to the Judiciary for proper scrutiny, saying its liking for out of court settlement of cases is tantamount to declaring the Judiciary redundant.
He cited the award of K20 million to men linked to Justice Minister Ralph Kasambara, which he said set a bad precedence to claimants.
“After this precedence was set, we have consequently seen a number of claimants being compensated handsomely in secret [and] more claims are flocking to government from a cross-section of the citizens including politicians.
“Why has the executive branch of government preferred to make the third arm of the government [the Judiciary] redundant in such cases?” queried Katsonga in his address.
The briefing further expressed concerns over irregularities in farm input subsidy programme, hunger situation; continued delay of civil servants salaries and President Joyce Banda’s continuous travelling, among others.
Katsonga also said his attempts to relay his party’s concerns directly to Banda have proven futile as he has been waiting to be granted an audience for two months now.
However, Presidential Secretary Steve Nhlane, while saying Katsonga tried to book for the said appointment about four months ago, said he could have utilised two meetings the president had with leaders of opposition parties.
“He could have presented his issues right there or if they were private, he could have asked the president for a private audience right there in the meeting,” Nhlane said.
Government spokesperson Moses Kunkuyu was not readily available yesterday to respond to Katsonga’s proposals as his assistant said he was in a meeting till late in the evening.
However, Finance Minister Ken Lipenga is on record to have assured the IMF that the government will not abandon the APM despite pressure from some quarters.
“Our people are feeling the pain resulting from these measures and we appeal to development partners to help us with resources to assure a greater degree of currency stability and mitigate the impact,” Lipenga was quoted as saying.
Both the Economics Association of Malawi and the Malawi Chambers of Commerce and Industry are also on record as having warned the government against reversing this APM, which they said is a necessary monetary and fiscal reform.
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