Hard times in Malawi

I started writing this post after only 3 weeks of being in Malawi, but I think I have better perspective now that I've been here for 6 months....

"Having lived in Malawi for only 3 weeks, I've already come to realize that the word "shortage" did not really have any real meaning for me when I previously lived in Canada or in Europe. Sure, chocolate chips and pumpkin puree seemed to be in short supply while living in Stockholm, peanut butter didn't exist in Spain and French's yellow mustard and Hellman's mayonnaise could not be found in France. Even back in Canada, one could argue that there are a short supply of taxis on those rainy Vancouver nights after emerging from a bar and buses don't run nearly as often as they should. Although at some point your cellphone battery is dying, money is tight, and time is running out, I don't think that the majority of "westerners" can truly appreciate the word "shortage". Here are only three of the shortages plaguing Malawi today to the point of crises and they are all related to eachother: fuel shortage, forex shortage, and electricity shortage."

Having lived in Malawi for 6 months, I agree with my thoughts those first weeks, although the "shortages" run deeper and are more prevalent than I first noticed on the surface. Added to the list of fuel, forex, and electricity are sugar, soft drinks, and more seriously drugs, medical supplies, water and even food. 

The root of many problems...NO FOREX

The almighty US dollar is scarce to be found in Malawi.

As someone who has lived in Canada most of my life, it is crazy to think that I don't have access to US dollars. At home, it is so easy to go to any bank and buy USD at the bank rate and go about my business. Here that is impossible due to the ongoing forex crisis which has spiraled into several other shortages.

If I am allowed to simplify the cause of all these issues, I would blame the policies and practices of the former Malawian President (he died a bout a month ago from a heart attack) which first and foremost, tampered with the real market rate of the Malawian kwacha and froze its value. This in turn created an artificially strong kwacha, meaning no one would give their precious forex to the banks for a bad exchange rate, but instead would seeks better rates on the black market.

When I first stepped off the plane last October, I did my usual thing at the airport to buy the local currency. Exchanging at the formal forex bureau in the airport, I was quite pleased that I received 170 MWK for every USD I gave, well above the bank rate of 164 MWK at the time. After some weeks here however, I soon realized the real value of a USD is more like 250-300 MWK from the informal forex dealers on the street. Doh!

I was laughed at trying to exchange kwacha on the Mozambique border, "Nobody wants kwacha" I was told.

The lack of forex in the formal banking system means that businesses can't do business (import goods) and that the country can't import goods such as fuel. The commodity shortages and fact that businesses are buying forex on the black market to survive, mean that they import goods at the high rate, and export goods at the low formal rate, cutting 30% or so into their margins. As a result, contrary to what President Mutharika was trying to do by not devaluing the kwacha (one can only assume), commodities and prices have skyrocketed with inflation in double digits.

The second main reason for the shortages, I will venture to assume, was caused by all the major donors pulling their funding support last year (donors funding make up 40% of the federal budget!!!!) citing the corruption and lack of good governance of the President Mutharika government, which in turn means that there is 40% less money for hospitals, education, and government employees. 

No Coke or Sprite

In the first months of living here, there was no soft drinks due to the high cost of importing bottles (high cost of forex while exporting the drinks at regular rate) for the local bottling plant. Newspapers ran comics of employees drinking beer at work instead of pop.

Read more about Malawi's soft drink shortage here.

No Sugar

Luckily before this crisis, I bought 4 kg of sugar which lasted us up until we went to Zambia, so then we bought some more there. People without so much luck, had to buy sugar on the black market for double or triple the price. When a shipment of sugar finally came in, people queued for hours to buy a limit of 2 kg. Although I wasn't buying sugar the other day, I had to wait an hour in a grocery line because of the crowds wanting to buy sugar from the last shipment. 

Queues made the paper, this is in Zomba

Even though Malawi produces their own sugar and is "sugar country" with lots of sugar cane, there was no sugar because of the artificially strong kwacha. Why would the local companies sell locally for weak kwacha when they could sell to surrounding countries to buy the desperately needed forex. If we were staying here longer I might have experimented with making my own sugar from sugar cane you can buy at the market.

Sugar story here.

In high demand

No Drugs

I'm talking about the good kind. With the lack of donor support and forex to import goods, drugs are really hard to come by. This is a scary one for us in case we run into health issues, although generally the private clinics should have stock. Often I read that some person died from rabies or malaria because the hospital didn't have proper drugs to treat the disease. ARV's are in short supply which doesn't bode well for the 15% of the population with AIDS.

Ironically, the same President whose policies and practices are responsible for the drug shortage, is said to have died because the hospital lacked of epinephrine. Here is an excerpt from a news story about this...

"Bingu collapsed on Thursday night and was rushed immediately to Kamuzu Central Hospital, a public facility. Upon presentation at the Kamuzu, workers realized that they were lacking epinephrine and had to run to a facility run by University of North Carolina to procure it. Bingu likely died because of problems of drug stocking in Malawian facilities and substandard levels of health delivery. Bingu died due to a problem endemic to all of Malawi. Ironically, the opulent President of Malawi died needlessly like that of even the poorest of Malawians."

Hunger is a reality for many

Although widespread famine has not been seen in Malawi since 2005 (as far as I know) mostly due to a fertilizer and seed subsidy program, hunger is still a reality for around 200,000 people this year in Malawi. When Danielle surveyed several people in rural villages, Shortage of Food, was the third highest challenge they faced. Even our security guard was telling us that they are buying their maize now (seasonally lower prices) to last the year so they don't go hungry later on. 

Fuel Shortages (Since the end of 2009, Malawi has a fuel crisis)

A long line for diesel

Imagine your life with no fuel. You go to your favorite gas station and the pump is dry... hmmm ok, I will try the dozens of other stations in town. All dry. How about in the next town, dry. It turns out you have to skip work to spend the rest of the day looking for fuel when finally your friend calls you and says there is a fuel truck (the only one this week) coming to a town some 50 km away, so you rush to that spot where you fine hundreds of vehicles lined up waiting for the precious commodity. In this line are buses, ambulances, firetrucks, army trucks, and police cars....no priority is given to local emergency services, a sobering thought if you even fine yourself in a car accident. After the gas station has set aside their cut of fuel for their friends, family and, dare I say, black market buddies, they start to address the queue. And so you wait, 4, 6, 8 hours, inching slowly. By now it is 1am, you only have ten cars left, and you are told that they are sold out. @#$% *#$&!@&!!!  

Even Emergency Services aren't spared the waits

Your only choice is to buy black market fuel. If you have the right contacts you might get a deal of 700 kwacha a liter (about 4 USD a liter!!!) compared to the pump price of 380 kwacha (~2 USD). If you don't have the right contacts, you risk water downed fuel which has busted many an engine here, and have to pay upwards of 1500 kwacha a liter (9 USD a liter!!!! that is 36 USD a gallon??). Count the day of work you missed and the lower purchasing power in Malawi, it is an expensive tank of fuel. Most of your life now revolves around working your contacts for a jerry can here or there, or knowing when the next tanker is coming in.  

As a result, mini-bus fares have doubled in recent years, price of goods have increased drastically, and it can be assumed that productivity in the country is way down. 

The Power is out again...

Danny already mentioned this in one of our dislikes here in a blog a couple of months ago, http://www.dannyandjoshinafrica.blogspot.com/2012/02/4-months.html.

It is a race against the clock everynight to finish dinner before the power goes out. It was around 630pm in December, but nowadays with shorter days it's around 530pm, meaning a very early dinner. As well the power goes out in the morning for a couple of hours, the peak times when everyone is flipping their switches. Main issue is ESCOM (monopolized government owned electricity generator and distributor) has a lack of generation capacity to meet the demand. It's something we've just gotten used to but it's furthering the fuel crisis with so many people buying diesel to run their generators. 

Power went out before dinner was ready so cereal it was for dinner

On a funny note that sums up the issues, one night when the power was out, we were walking by a fuel station with a huge line of cars. Our friend was waiting in line and complained that although the station had fuel, there was no power to pump the fuel into the cars, and that the brigthly lite gas station next door had their generator running, but did not have any fuel to serve their customers. Ah Malawi!

Although this post is somewhat depressing, it is the reality of the situation that Malawians have faced over the last couple of years. Yet you always hear them complaining with a bright smile and laugther. "Oh, ha ha ha, no fuel today, maybe tomorrow."  Despite the hardships, people are very hopeful with the new President Joyce Banda, who came into power last month after the sudden death of President Mutharika. We all hope she can improve the situation but has a tough road ahead.