Mutharika Adamant Not to Devalue Kwacha
President Bingu wa Mutharika has re-iterated that his government is not ready to devalue the kwacha, despite mounting pressure both locally and internationally.
The president’s remarks on Sunday came barely days after a World Bank team were in the country trying to help chart the way forward on the battered economy.
According to the president, his government will not automatically adopt proposals by the World Bank, saying ways must be found to marry their suggestions with home-grown policies.
“There are even some economists in own government who, either due to total ignorance or childishness, think that if we were to devalue the kwacha, prices of goods will not raise so high—which, of course is not true,” said Mutharika.
The president said his insistence that the local currency should be devalued now doesn’t mean that he is merely stubborn, but that the move would have far-reaching consequences to the poor.
“I’m simply trying to protect you, especially women, from the negative repercussions of this devaluation, not being stubborn as some people would want us to believe,” the President said.
Turning to the recent visit by a World Bank team in the country, the president brushed aside reports that he declined to meet them.
He said the reason why he didn’t meet with them because the World Bank team had already had meetings Mutharika's peers and other government officials.
The president made it point blank that his government will not simply take what the World Bank put forward as gospel truth, but will see how his government can marry the proposals with his own policies.
“We’ll have to see the offer from the World Bank and find out how we can marry it with our own ideas, but shouldn’t be a situation whereby one would regard him wiser than the other,” he said.
The World Bank team, led by the bank’s African Region Director of Economic Management, Marcelo Giugale, met Finance Minister, Dr. Ken Lipenga, among other key government officials.
The kwacha is currently officially pegged at K167 to the US dollar, but the Bretton Woods institutions want the currency to be devalued by 40 per cent.—Zodiak Online