Nzika Coalition leader and presidential aspirant, Milward Tobias, has disclosed that, if voted into power in the 2025 General Elections, his government will settle for an exchange rate system based on a technically sound assessment of its ability to engender economic growth, expansion of employment and reduction in income inequality.
Tobias, an accomplished economist, added that his government will pursue economic policies that will aim at engendering food security and social welfare maximization.
He made the sentiments on Wednesday afternoon during an interaction with journalists from various media houses in Lilongwe.
This is the first time Tobias has held an interface with the media since he expressed his intention to run for the president.
"It will be an exchange rate system that achieves a stable, predictable and resilient exchange rate," he said, "We take cognizant of the structural constraints that current and previous governments have failed to address. Additionally, current and previous governments have not built resilience of the economy to exogenous and endogenous shocks. Your next government will prioritize addressing these issues. The other challenge that constrains the ability to attain a middle income status will be addressed by doing away with independently floating exchange rate regime."
In his six-paged statement titled: "National Development Planning and Economic Framework", Tobias said while he recognized that the desired economic growth rate is higher than what has been achieved in the recent past years, his coalition is aware of the enormous potential Malawi has.
He stated that the coalition is also aware that growth rates of the desired level have been achieved before especially during the period 2005 to 2010.
"All the same, the mammoth task ahead is acknowledged and we are prepared for it. Your next government realizes that to achieve an inclusively wealthy and self-reliant nation, economic growth must be both inclusive and sustainable. Thus, while focusing on macroeconomic framework discussed in the immediate next section, the micro economy will receive equally substantial focus. Your next government will work to increase opportunities at individual and household levels to increase opportunities to earn more income on one hand and to reduce cost of living on the other hand. We will increase opportunities for earning more income through job creation, facilitating growth of businesses especially micro, small and medium enterprises and strengthening markets for agricultural produce while ensuring large scale businesses are supported to anchor industrialization. We will reduce cost of living by containing price of fuel through ethics in procurement and use of efficient means of transport; price of food through increasing agricultural productivity for farmers to produce more and make profit on volume and price of accommodation through the home ownership program discussed in another section. At the heart of national development planning and economic management framework is welfare of people. Macroeconomic framework," he read from the statement.
Tobias attributed the sluggish economic growth to failure by the current administration to formalize the currently informal economy, export under declaration, illicit financial outflows, high unemployment rate, weak private sector and conflicting tax policies.
He said these have resulted in stunted growth of the tax base.
On the expenditure side, Tobias highlighted high appetite for luxury, failure to invest in government office buildings, rampant corruption and politically-driven recruitment of public servants to fill in positions that are already staffed as some of the factors bloating the public expenditure.
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He said the result of these has been continued and increasing public borrowing standing at 84.8 per cent of GDP (Ministry of Finance and Economic Affairs, 2024 Budget Statement), increasing payment arrears and continued narrow fiscal space to finance human and physical capital formation.
"Your next government will approach fiscal consolidation from the perspective of growing tax revenue through growing economy, creating jobs, businesses and rewarding markets for farmers on one hand and removing luxury and reducing unnecessary expenditures on the other hand. This will enable your government to consolidate the fiscus without compromising its ability to deliver public services, which is the very objective a government exists for," said the presidential aspirant.
