OP-ED
Recent news about Ethiopian and Kenya Airways suspending ticketing services over Country’s forex crisis has woken up Malawians to the fact that we are facing economic challenges.
While the whole world is in more or similar economic state culminating from several factors that has rocked the world economy such as Covid 19 Pandemic and more recently the War in Russia and Ukraine, locally the reliance of importing more than what we are exporting,Unfavourable weather conditions and the impact of several tropical storms has speeded up the challenges that we are facing at the moment.
I had opportunity to speak to the Minister of Finance Hon Sosten Gwengwe yesterday and it was pleasing to note that he was very much optimistic that things will settle and the economy will be back on track. Government is working hard to make sure that systems are in place to avert a possible economic crash.
Myself as an advocate for the diaspora and the role Malawians living abroad can play on various issues affecting our country, it is pleasing to note that in challenging times like these- the diaspora can play a crucial role in injecting a major boost to economy and the foreign currency reserves for the country.
With estimated more that $200 million dollars of remittances coming from the diaspora every year,The Reserve Bank of Malawi has not been hungry enough to capitalise on this for the sake of boosting foreign currency reserves. The government loses out alot on these remittances as the money exchange is predominantly done through informal channels on the black market rather than through financial institutions. By doing so, the transactions do not become part of the balance of payment and foreign exchange reserves hence Government benefitting less.
Recent world Bank report projects that in Sub Saharan Africa remittances inflows is projected to grow by 7.1% from the $49 billion that was the annual flow on 2021 in the region.In times like these , those in the diaspora should rise up and show our patriotism to our country Malawi by sending more remittances in order to ease the Forex shortage crisis.
For this to be fully effective ,Reserve Bank of Malawi need to think outside of the box on how they can accommodate these Diaspora remittancesReserve Bank need to encourage the diaspora to remit the foreign currency through registered money transfer agencies rather than the black market. Reserve Band should think of offering the diaspora a special exchange rate that will entice them away from the informal money exchange
During a recent Diaspora interface with the Finance Minister ,some members of the diaspora even suggested that the Reserve Bank can open its own money transfer scheme that is specifically cartered for the diaspora and that would ensure that government is directly benefitting from the remittances
As patriotic as the diaspora has always been, we are ready to play our part in easing Forex shortage woes but Reserve Bank need to act swiftly in order to accommodate us.
-Views expressed, as taken from the authors Facebook page are those of the Author ,Chalo Mvula who is also the Chairperson of Malawi Congress Party Diaspora Network-
