Richard Chirombo on Privatisation, Trade and HIV/AIDS

PPPs shift to distort PC’s funding mechanism

BY RICHARD CHIROMBO

GOVERNMENT’S planned shift from privation to Public Private Partnerships (PPPs), currently awaiting cabinet approval, will affect traditional funding mechanisms for the Privation Commission (PC) as it places more responsibility on PPP-sponsoring ministries.

This contrasts sharply with present trends, where the PC sources its funds through appropriation of proceeds. This is done with prior approval of the Ministry of Finance, and is provided for in the Public Enterprises (Privatization) Act.

Under the PPP, however, it is intimated that the bulk of transactions’ costs will be identified by the sponsoring ministries because PPP projects will be conceived by government ministries and departments.

Sponsoring ministries are ministries under which government departments or statutory corporations fall. For instance, the National Lotteries Board (NLB) is a statutory corporation that falls under the Ministry of Finance (MoF). MoF is thus NLB’s sponsoring ministry in cases of PPPs transactions.

According to the PC’s 2008 Annual Report, the new arrangement will make it possible for ministries to opt for donor funding in case of huge transactions whose funds may not be sourced locally. Operational costs that may necessitate donor interventions will include complex feasibility studies, value for money assessments, management and procurement initiatives.

“(In fact) a Project Development Facility will be established by the Ministry of Finance to co-ordinate funding requirements for various PPP initiatives. It is envisaged that the MoF will mobilize donor funding to meet transaction costs in various ministries,” reads part of the report.

Malawi has intensified efforts towards establishing a PPPs framework, with the MoF taking the lead. The ministry currently leads a steering committee that is coordinating implementation of the framework.

Members of the steering committee include MoF (Chair), Office of the President and Cabinet, Ministry of Economic Planning and Development, Ministry of Industry and Trade, Office of the Director of Public Procurement and the Privation Commission.

The committee’s main task has been to draft a national PPP Policy and Bill, which has since been prepared and submitted to cabinet for approval. This came about after a comprehensive review of legal, institutional and regulatory frameworks.

The World Bank, through the Public Private Infrastructure Advisory Facility, has been in the fore-front bankrolling the review programmes. The bank was also instrumental in funding the Privatization and Utility Reform Project (Purp) in 2007, a programme remembered for two things back home: building capacity interventions that saw most professional staff at PC being equipped with PPPs management skills, and the dismissal of 10 staff members from the privatization implementation agency.

“The winding up of Purp saw the reduction in the Commission’s (PC) staff complement from 30 to 20,” says PC’s Chief Executive Officer Jimmy Lipunga in the report.

The report indicates that, while more work has already been done, more remained in the pipeline. After the draft bill and policy have been approved by cabinet, for example, there will be need to define the extent to which the PPP approach will be applied within the public sector.

This will be followed by a comprehensive public awareness campaign aimed at acquainting Malawians with the new concept as well as its role in public policy. It is hoped that this will help clear misconceptions about privation.

Already, the privatization programme, now wobbling through its last days, has been heavily criticized for creating job losses and creating less employment opportunities as some of those engaged are expatriates with questionable credentials.

Consumers Association of Malawi Executive Director, John Kapito, is less charitable in his appraisal of the programme. He says privatization has not translated into the much-needed improvements, in terms of customer service delivery and satisfaction.

“There are many areas that (still) leave a lot to be desired in terms of service delivery,” said Kapito.

The PC has, however, often cited the many privatized companies that are doing well on the market as the silver lining of the whole programme. These include S&A Cold Storage, Bakhresa Grain and Milling, Chitakale Tea Estates.

Indications are that the Ministries of Health, Transport and Public Works, Housing, Education and Tourism could generate a significant number of PPPs.

“This is (PPPs in these ministries) in keeping with the spirit of the Malawi Growth and Development Strategy, which places much emphasis on infrastructure as a means of attaining economic growth and poverty reduction,” says Lipunga.

Adds Lipunga in the report: “Studies have shown that investment in infrastructure creates positive effects on not only the economic well being of citizens but also nearly all the social indicators. To the extent that the PPP policy framework will stimulate growth in infrastructure it, therefore, means that the quality of livelihoods at grass root level will, of necessity, improve- an essential ingredient in the attainment of Millennium Development Goals.”

The PC points at the Shire-Zambezi Waterway and its accompanying sub-projects, Mtwala and Nacala Development Corridors, Kapichira Power Plant, Cape Maclear Tourism Developemnt, rehabilitation and refurbishment of terminal and runways at Kamuzu and Chileka International Airports, Lilongwe and Blantyre Water Boards, strategic fuel reserves in Liwonde and oil pipeline from Nacala/Beira as some of the potential candidates for PPPs.



Service exports could help improve Malawi ’s Trade Balance

BY RICHARD CHIROMBO

AS Malawi continues to chalk persistent Trade Balance deficits on her economic sheets, indications are that the country could do more if it tightened its grip a bit tighter over service exports.

The country has for the past two decades failed to reach the bench-mark 15.6 per cent of service exports for developing countries and has, instead, continued to hover below 11 per cent. This has translated into five or more percentage points below the set standard for most African countries.

An International Trade Centre (ITC) Capacity Study to Promote Exports of Services from Malawi , released on January 31, 2005, indicated that the country had the potential to make it big in, at least, nine areas.

These include accounting, auditing and book keeping; educational services; equipment leasing; health-related services; legal services; management consulting; peace keeping and security services; agricultural and medical research, and; tourism related services.

In spite of this potential, Malawi has continued to perform below par since 1995. While the export percentage for goods declined by negative-0.8 per cent (from 94.8 per cent in 1995 to 89.5 per cent in 2002), service exports only grew by 10.7 per cent (from 5.2 per cent in 1995 to 10.5 per cent in 2002).

During those years, travel and tourism grew from 3.7 per cent (in 1995) to 7.1 per cent in 2002 while transportation services (export) grew from 1.4 per cent to 3.4 per cent, among others.

This is also vindicated in International Monetary Fund Balance of Payment Statistics Yearbook (2004).

However, recent statistics from ITC indicate that the country has not improved much on service exports, despite indications that the area could help it cover up for some of its Trade Balance deficits.

“The average for developing countries is for services to be 15.6 per cent of total exports, and Malawi is considerably below that average,” says an ITC report, which also looks at Malawi ’s prospect for 2010.

It adds: “Under the next five years, the international context for Malawi ’s trade services will become increasingly liberalized, which will increase foreign competition for Malawi ’s service firms, both abroad and in the domestic market.”

However, indications are that the country was yet to attain this status- where the country’s service firms are much sought after both at local and international level. The proliferation of foreign firms in Malawi itself has resulted into wanton cries of exploitation that the Malawi Congress of Trade Unions, for instance, has since called for the deportation of all exploitative companies.

Most Malawians still go out to perform manual labour in such countries as South Africa, also, as the country still bathes in darkness over its unemployment rate. There is no official rate for unemployment, except sketchy details found in district strategic development plans.

This could explain why the Malawi Growth and Development Strategy does not explain anything about current unemployment rates, and, very much, the country’s blue print seeks to reduce such rates. The development ostensibly means the country can not calculate the overall value of its service exports, by looking at the number of skilled people who may help it offer services abroad, and how many need skilled training to compliment the labour force already contributing towards Malawi ’s service exports.

The Chikwawa District Strategic Investment Plan (2008-2015), for instance, indicates that only 10.7 per cent of the population is engaged in wage employment of some form or another while the national picture remains blank.

Globally, the most growing component of international trade has come to be that of ‘other services’. These are all services other than transportation, travel and government services.

Such services have grown at an average annual rate of 6.0 per cent since 1995.

ITC says Malawi’s ‘other services’ have included the export of professional services, business support services, educational services, financial services and health related services.

It, however, bemoans the general lack of information on the country’s ‘other services’ exports.

“It is unfortunate that there are no data on the volume of Malawi ’s ‘other services’ exports. (However) imports of ‘other services’ have increased from 1.7 per cent in 1995 to 4.1 per cent (in 2005) and have been growing at an average annual growth rate of 17.0 per cent since 1995,” says ITC.

Malawi has been exporting legal services to such countries as Belgium , Burundi , Canada , Ethiopia , Finland , France , Germany , Ghana , Greece , India , Italy , Japan , Kenya , Netherlands , Norway , Pakistan , Sudan , Switzerland , United Kingdom , USA , Zambia , Zimbabwe , among others.

The main importers of Malawi’s accounting services are Germany, Italy, India, Switzerland, South Africa, Sudan, Pakistan, among others, while the European Union, India, Pakistan are the main importers of architectural services.

ICT indicates that Malawi has also made some international in roads with such services as engineering, design services, medical services, midwives and nurses, computer services, agricultural services, equipment rental and leasing, property maintenance, among others.

Malawi ’s trade balance with the rest of the world widened by 31 per cent from K69.2 billion in 2007 to K90.4 billion during the 2008 trade year.

Government has, however, blamed the development on high crude oil and fertilizer prices. This forced government to dig dipper into depleted coffers as the two commodities continue to be some of the country’s strategic imports.

New Finance Minister, Ken Kandodo, has said the development was inevitable since government had to go ahead with the fertilizer subsidy programme but sees improved fortunes this year.

Trade balance is the difference in monetary value of a country’s imports and exports. Statistics indicate that, despite the potential to cover up for the country’s trade deficits, the country continues to consume what it does not produce, and import more than it exports.

This has incensed President Bingu wa Mutharika, who seems eager to shift the country’s focus from that of a net importer to one whose products and services saturate international markets. This has been government’s main policy goal for the past five years, a trend billed to continue- now that Mutharika has a legal cover of five more years.











How HIV and AIDS wedged between me and my sister

I come (rather came, for the two most important people in my life are long gone towards that way of all the earth) from the family of four children- two boys and girls. A family of equal opportunities, as that figuring implies. During the night of February 3, 1981, my father was busy working in the field in Chikwawa when a child cried at Queen Elizabeth Central Hospital; to be so lucky as to be the first born, that dilemma newly-married couples face, and the questions: When and how to chase you out of their bedroom when they feel like you are old enough to know ‘some’ things.

It is an age old dilemma for the child, too. How to cope with a solitary bedroom and the darkness, for those whose parents may not afford housemaids as was the case with me. The first feel of the independence that is to come at one point in life, when one leaves the home to make out life by themselves. Mr. Leviano Simon Chirombo, that was my father’s name (which I have wholly adopted) and Mrs. Chirombo always made it a point to remind me that being first meant-born meant being a leader of the family in the absence of parents and older relatives. So, it sank into me that whoever came after me would respect me, and expect me to lead the path. I never expected something else. (This is the essence of this, my real life story).

My solitary room in house number 11 in Chitawira, Blantyre, which during the day served as a kitchen, would soon have to house two souls, following the birth on September18, 1983 of my brother Madalitso. That was before the first female of our family, Prisca, joined the world of the Chirombos on February 22, 1988. Shortly after, we got transferred to Salima district when it appeared to the Electricity Supply Commission (the term ‘corporation’ used now was not yet born) of Malawi (Escom) that their employee, Mr. Chirombo, needed to move on.

Those who have been to the lakeshore district can testify that it can be horribly hot. Add to this the relatively salty water people who live there have to put up with without noticing it. Old people in Salima say the salt in the drinking water (including washing, or whatever it be) is a ready-given cure to mosquito bites, one of the nuisances of the wonder that is Salima. God might be a real genius because, our moving to Salima- what I call our shift towards the heat and the salt- might have been a prophesy, the metaphor for a prophesy; that they represented the heat that life would throw at us, the pain that we would have to bear without the barest opportunity to fight back, or defend ourselves.

There, in Salima, I experienced the worst part of my life. Barely two years in the district, my mother fell sick. It was to be the beginning of a continuous ‘shifts’ of her sickness. It all started after the birth of the last born in our family, a sister called Donatta.

Mother, Maccullata remains her beautiful name, moved from one district to another- Salima, Zomba, Dedza, Ntchisi- in search of cure to her ‘mysterious’ disease. I was young, around 11 years old, and did know what she was suffering from- did not want to know because I feared the sadness that might have gripped me. That is when I learned the real meaning of love (my definition of love): Love is the feeling that holds us from visiting our parents and loved ones when they begin shedding off the very body they have built over so many years of good food, for fear of meeting our worst fears (not our best feelings). Those opposing, let them raise a finger against me!

The sickness went on for about three years. I was innocent, not knowing what it was mother suffered from. The last time I saw her, she had just come from a private clinic at Nsangu, along the Malawi College of Armed Forces road in Salima, where she had been for three months. We used to go, me and my brother (Prisca and Donatta were very young) to see her. Sometimes she would be of good cheer, sometimes she would be not. I remember the blue paint of sadness we wore on those days; her sadness was ours, too, our natural concern. Then, one day, she came home. Unable to walk; to stand on her own. People supported her on both sides, the left and the right hand sides.

What had happened? We knew that our mother was a walking being, who helped us walk.

The next day, mum left for Zomba- or so we were told- in the never ending search for good health. Life. Then, a month later, on June 21, 1993, the message came. She was dead.

I couldn’t grasp the reality that for all I am, I was only allowed to live with my mother for 12 years. I remember asking my nine-year old younger brother: “So, we will never see her again?” This, of course, was a stupid question. As the older one, I was supposed to know better, to be a leader in courage and strength.

Let me also say here that I never saw mum in state; how she looked when she was dead. Absolutely no picture. This is because we arrived in Kantchito Village, in the area of Traditional Authority Kamenyagwaza late, an hour after burial. It pains, that I was not even allowed to see my mum in state.

She must have known that she was dying, however. Because, in the interim as she searched for medicine, she had arranged that my two sisters- Donatta and Prisca- go and live with her elder sister in Rumphi district once she was dead. The two went, on June 28, 1993. We would never see each other for the next 11 years, until September 21, 1998. This is long after my father died on September 18, 1998.

He had been to Salima District Hospital, admitted for Tuberculosis. He had been to Mtengowanthenga, seeking treatment for shingles. He had been to so many places, Mr. Leviano Simon Chirombo, only to be overtaken by pneumonia. That September night, children were playing outside our house in Takomana, when my father died at home but we couldn’t tell them to keep quite because, even after two years of continued sickness, the reality could not sink in just like that. That a father was gone, and with him, our colourful past.

I remember one of our cousins, we had lived with him for almost 11 years, telling me: Kids, you have entered another phase of your life. No luxury. I thank Nisphore Gervasio Chirombo, now deceased, for that peace of advice.

These details are important to keep you in context of what I have to say next.

My youngest sister, Donatta, is the first one I saw on September 21, 2004. She had come to visit in Chilomoni, Blantyre, where I had lived with my uncle since 1998. That day, I arrived ‘home’ around 7:00pm to hear that Donatta, now 11, had been waiting for me for close to two hours. She had arranged to sleep here, anyway. I found her sitting on the verandah, surrounded by the whole family of my uncle- four children plus the aunt (only the uncle was not home).

She did not greet me, she just started (here, she will be DC and I, RC):



DC: Where have you been?

RC: Mbayani. I was visiting my friends –Justice Mponda and Lucius Phaiya.The stay together.

DC: Who asked you to mention that? Is this your house? Coming at 7:00pm?Answer me now!

RC: Quiet -Thinking: this 11 year old must be mad)

DC: Answer me. Since when have you had a house of your own to come home this late: Is this your house?

RC: (Quiet -Looking at her to see if it really was coming from her. She was breathing hard; she was angry. I saw it more than felt it. The others just watched. I think they felt sorry for me, stripped like this n public).

DC: Ok, you must be as stubborn and inconsiderate as your father. Like him, you never came to visit us in Rumphi, you hard-heartened creatures!

Your father, he was a very bad man, you know. We have heard that he used to move from one place to another as he worked for the Transmission Department of Escom at Salima. Today he would be in Nkhotakota, tomorrow Chintheche or Nkhatabay.

RC: (Listening)

DC: You know what he used to do? Sleep with different ladies. One day mum caught him. He was a bad man, your father. Let me tell you something…………

RC: (Listening)

DC: Your father infected my mother with HIV. They died of AIDS. It was AIDS that killed them!



I stormed out of the verandah, in anger. My own sister couldn’t be speaking as if my father was not her father. Anyone who hates my father hates me, I said, and that’s what I maintain to this day- hate him and hate me. That night in my bedroom (there was no bed!) I made enemies with her. That same night, she lost a brother. I don’t know f she knew that. I did not even escort her the next day because she had shamed me in ‘public’, before all those people.

To day the truth, I knew nothing about the HIV and AIDS issue. And I never even suspected anything from my parents’ deaths. For her, then, to say it like that pained me. I have never been troubled like that before. I will never be. I even told this story to the people I knew to be my enemies so I could get angry at Donatta every time they reminded me about it. It was a way of not wanting to forget it.

Donatta went and, over time, crossed the path of those who were doing everything for her (I still believe the spirits were angry with her for defaming the dead), and they abandoned her in the village, Dedza. There, she has missed school since 2007. She was in form one. My younger brother told me she had started moving about- Lilongwe, Dedza boma, Ntchisi- without taking leave at home or saying where she was going. I did not care; she was my enemy. That thing about my parents dying of HIV and AIDS.

Then, on January 10 this year, she called me, asking if she could come over and continue with her schooling after almost a two-year break. I told her no, she needed to find her real ‘brothers’ who could help her. I would not be sisters with someone who talks ill of my father, about the things I know nothing about, and in ‘public’. I was not one of them.

I hang the phone. But the next day, she called again, and said we needed to forgive each other. That, perhaps, it was the people she had been staying with who misinformed her. She said she regretted saying it the way she did.

I still said no.

Then, on January 18, 2009, I met my long-time friend Jonathan Kaliveni who told me ‘live’ that his parents had died of HIV and AIDS, and that it was common knowledge in their family.

That’s how I got my break-through over the issue of HIV and AIDS and my parents. If Jonathan can say it in the open, and without being asked, what is so shameful about being HIV-positive? What if they really died from its related illnesses but just kept it under raps because I was young? Or, put in other words, if they died of other health problems not related to HIV and AIDS, can I bring them back? No.

That’s why I invited Donatta home. Now, I happily pay her school fees, and she really takes good care of the home. HIV and AIDS will never divide us again; it must unite us as we seek that will help us curtail the same.

We are family again.