Wednesday, February 29, 2012

Hoping on Hope

Hope, the steel bars of every plan, can take people places- places they have never been to before.
Hope- which becomes regret, those times when 'if only' befriends the knee- has helped people die in vain, if not in the vanity plain, on the 'understanding' that, someday, tomorrow is meant to be better than yesterday.
It is so simple to understand this. Yesterday, the elder brother to this expiring day, came as a surprise to you and me. We were less experienced.
Today, with yesterday's experience, we are mature. Perhaps strong. We must be ready for what may, today, us befall.
That is the understanding. This understanding is premised on the supposition that yesterday, today and tomorrow are generations.
Yesterday was the (not 'a') generation. A generation of yesterday.
Today is a generation. The generation of today.
And, so, will tomorrow be. Tomorrow's generation.
It is better said than elucidated.
But simple to comprehend, all the same.
Now, let's go on this path of 'generations'; this path about (let's call it) the 'generations of time".
Yesterday. Generation.
Today. Generation.
Tomorrow. Generation.
It makes sense. Because all generations are based on time. All generations are counted against time. All generations are premised on time.
That is, time and generations are all the same. They are one.
Like body like spirit. The two are one.
If not in form, at least in purpose.
The purpose that begets unity. The unity that builds on the spirit.
Let's make it simple.
Yesterday (for this is what all this is about) is supposed to mold us into better, prepared citizens.
Yesterday is, on its on, supposed to be a teacher.
A teacher to individuals. A teacher to nations.
That is how animals (wild and tame) flourish.
They may not have the 'knowledge' of the human being. They may not be as brainy as the human being.
But they have a 'brain' that does not belong to them. This brain has no cells.
This brain has no skull.
In fact, it is not a brain that 'rests' at the end of that, often, stretched organ called the 'neck'.
No. The brain of the animals is 'yesterday' (or time).
That is why, when a tiger tastes human fresh, it will develop that habit. It is not developed out of instinct. No, it is out of time- a sense of what happened yesterday.
Now, if animals can so behave- on the strength of yesterday- what more with humans.
Why, if a question may be asked, can't human beings find solutions to fuel, forex, whatever, shortages they may have.
Based on this other brain: yesterday.
Others call it experience.

Wednesday, February 22, 2012

The Story of Khader Adnan

Khader Adnan, a 33 year old Palestinian activist, is in detention- lying shackled to a hospital bed in northern Israel and under constant armed guard.

He has been on hunger strike for over 60 days and doctors have warned that his life is in serious danger.

He was arrested on 17 December 2011 and started his hunger strike a day later to protest against his ill-treatment by the Israel Security Agency (ISA).

In January this year, he was given a four-month administrative detention order signed by a military commander.

Administrative detention is a procedure under which detainees are held without charge, or trial, for up to six months and which can be renewed repeatedly.

In the meantime, because of his hunger strike, Khader Adnan’s health has been deteriorating quite seriously. Hundreds of other Palestinian detainees and prisoners have joined his hunger strike.

Tuesday, February 21, 2012

Local censorship goes global as media under siege- CPJ

New York, February 21, 2012- Repressive governments, militants, and criminal groups across the globe are leveraging new and traditional tactics to control information, with the aim of obscuring misdeeds, silencing dissent, and disempowering citizens, according to Attacks on the Press, a yearly survey released today by the Committee to Protect Journalists.

As demonstrated by Eritrea and Equatorial Guinea's media blackout of the popular uprisings of the Arab Spring or Syria's blackout on the repression of protests, or Egypt's unplugging of the Internet, local suppression of information-whether by technology as done by Iran, legal persecution as in Ecuador and Turkey, or violence against journalists as in Mexico, Uganda and Somalia-has global repercussions.

"Navigating political unrest, environmental disaster, and other disruptions cannot be done effectively when information is censored," said CPJ Executive Director Joel Simon. "In a globalized information age, censorship is a transnational violation that must be emphatically countered."

CPJ found that in the Arab world, journalists face unpredictable new threats, and in Asia intimidation has a chilling effect. In Africa, investigative reporting is considered a threat to development; in Latin America, state media serves as a politicized weapon against the independent press. Worldwide, Internet crime laws put journalists in potential peril.

Attacks on the Press, the definitive annual assessment of the state of press freedom worldwide, features analytical essays by CPJ experts along with an overview of media conditions in more than 100 countries and regional data on anti-press violations. The book also documents individual cases and provides a census of journalists killed (46) and imprisoned (179) in 2011.

Key regional trends identified by CPJ include:

As China becomes a key trading partner and expands its influence in the region, governments from South Africa to Gambia are criminalizing independent reporting on bad governance, demonizing it as detrimental to economic development. Some countries like Ethiopia and Burundi even use anti-terrorism laws to prosecute critical journalists and cow the press into self-censorship. Repression is happening in the form of injunctions, amendments to laws, and seizure of footage. The watchdog role of a free press is being publicly tarnished and critical reporting deemed anti-patriotic. Over the past 10 years, at least 301 African journalists have fled their homelands in fear of violence and imprisonment -- more than double the number of exiles from any other region.

The use of state-owned media to advance political goals has become a notorious trend in politically polarized countries in Latin America. In addition to delivering political propaganda, these outlets are serving as platforms for smear campaigns against critics, including journalists. Elected leaders have invested in large multimedia holdings, building impressive press conglomerates that further political agendas and exclude or vilify critical voices. Meanwhile, in Mexico, anti-press violence continues to spread, unpunished. As the Calderón presidency winds down, a mechanism to protect journalists remains an empty promise and the investigation of journalist murders remains in the hands of often corrupt state authorities.

Censorship in Asia is multifaceted, from official repression to violence that is regularly met with impunity. Since 1992, the region has seen 156 unsolved journalist murders. For the past two years, Pakistan has been the deadliest country in the world for journalists, leading many into hiding or exile. In the Philippines, a trial seeking justice for 32 journalists and media workers murdered in 2010 has stalled, a testament to the government's inability to deliver due judicial process and the impunity plaguing the region. Meanwhile, in China -- despite vibrant debates on microblogs that give mainstream media the pulse of grassroots anger -- authorities keep a tight grip on information with imprisonment, secret detentions, and Internet blocking.

Europe and Central Asia:
The gap between countries that uphold press freedom as a core value and those that curb a critical, inquisitive press is widening. Within the EU, Hungary has set a dangerous precedent by adopting a new media law and constitution that challenge fundamental European values. Regionally, the protection of sources has become a major battleground, as some governments are eager to defang investigative journalism. Street protests have proven risky, while populist and nationalistic movements along with criminal organizations intimidate the press. In its external relations, the EU neglects press freedom in dialogue with powerful countries such as China and Russia, where imprisonment and impunity in journalist killings, respectively, remain the norm.

Middle East and North Africa:
Amid upheaval, the success or failure of popular uprisings rests with control of the national narrative. Journalists therefore find themselves the targets of new and evolving threats, with prolonged politicized trials diminishing while assaults and fatalities rise. While citizen-generated footage gives traditional media political cover to address sensitive subjects, authorities and their surrogates are making equally astute use of new technology to disseminate their messages, silence, and intimidate. Iran's revolving-door prison policy drives many journalists into exile.

CPJ is a New York-based, independent, nonprofit organization
that works to safeguard press freedom worldwide.

Thursday, February 16, 2012

Women Bear the Burden of High Cost of Living: CfSC Press Statement for January, 2012

As Malawi continues to wallow in economic hardships, low and middle income earners persistently struggle to afford even the most basic of monthly commodities. The Centre for Social Concern (CfSC) Cost of Living report for 2011 indicates that the cost of living went up by 21% between January and October 2011 (see Figure 1), whereas the earning power increased at an average of 7% for civil servants and almost at the same rate for other sectors. This unmatched increase in the cost of living continues relentlessly and is negatively impacting on household food security.

As Figure 1 portrays, towards the end of 2011 the cost of the Basic Needs Basket continued to increase dramatically and the survey for January 2012 shows that this upsurge will persist if nothing tangible is done. From December 2011 to January 2012 the cost of living went up by an average of 9.7%: Blantyre registered a 12% increase, Lilongwe 11%, while Zomba and Mzuzu had an increase of 8%. The total basic needs basket comprising of food and non-food essential items for Lilongwe, Zomba, Blantyre and Mzuzu for a family of 6 people is now at K77, 760; K65, 449; K74, 059 and K66, 454 respectively. Regarding commodities in the basket, almost every item went up drastically. For instance, Maize price hiked by 30% in Zomba, beans went up by 17% in Lilongwe and tomatoes had gone up by 36% in Zomba city. In Mzuzu, prices for food items seem to have stabilised in January.
Households most affected by this increase in food prices are net buyers who typically spend a large share of their income on food. The most vulnerable net buyers are female-headed households. Studies have shown that female-headed households are disproportionately among the poorest of the poor in rural and urban areas (Coon, 2008) and that sudden increases in food prices have negative repercussions for female-headed households in particular, partly because they tend to spend proportionally more on food than male-headed households and therefore are harder hit by higher food prices (FAO, 2008).

As Alex Nkosi, the Social Conditions Research Programme Officer observes, “For women headed households living below the poverty line, providing even one meal a day for children is often a struggle, compounded by women’s lack of access to productive assets and credit, as well as cultural norms that accord women the main responsibility for meeting household consumption needs. For such households higher prices have an immediate impact on the quantity and quality of food consumed”.

In the light of the ever increasing cost of living, CfSC carried out a study to uncover the survival and adaptive strategies that poor people employ in order survive in the face of inadequate resources. The study revealed that poor households employ strategies ranging from dietary change to rationing. In terms of dietary change, households start to rely on less preferred and less expensive food. Some families send their children to eat with their well-off neighbours or send their household members to beg either within their community or in town centres. Others simply borrow food or rely on help from their well of relatives or gather wild food to survive. As regards rationing, families limit the portion size at meal times or resort to feeding working members of the household at the expense of non-working members.

Alex Nkosi further notes that, “it is women who bear the brunt of high food price rises, not only because they are primarily responsible for the management of food in the household but also because they are often the ones who buffer the impact of the crisis at the household level through decreased consumption”.

These strategies have significant consequences, especially for the most vulnerable groups (sick, elderly, children, pregnant women). The fact that women and children face particular lifecycle vulnerabilities, however, means that malnutrition can have particularly devastating health effects. Women and children are particularly vulnerable to the nutritional effects of high food prices, given that they are more likely to develop micronutrient deficiencies when driven to consume less diversified daily diets. Children, pregnant women and lactating mothers are most at risk of the effects of rising food prices (FAO, 2008; Oxfam and Save the Children, 2008; UNICEF, 2009). The high cost of living affects maternal health in particular, with malnutrition rendering pregnant women more susceptible to infection, miscarriage and premature labour. It also increases the likelihood that pregnant women who are HIV positive will transmit their virus to their children.

CfSC is concerned with the alarming rate at which the cost of living is increasing in Malawi and its consequent impact on poor households. While some of the food price increases are justifiable considering Malawi’s current macro-economic situation, CfSC strongly feels that most business people are taking advantage of the situation to rip-off poor people. CfSC strongly encourages government to study the situation and take appropriate action to remedy the situation. Additionally, vulnerable people like women-headed households need to be protected from shocks through effective safety nets. Safety nets may include assistance in the form of food, vouchers or cash transfers as well as employment programmes like food or cash for work.

Amnesty International on Malawi: Former Attorney General Returned to Prison Despite Bail Order

Press Release
16 February 2012

The Malawian authorities must comply immediately with a court order to free former Attorney General Ralph Kasambara on bail, Amnesty International said after he was rearrested on Wednesday night, just hours after his release from detention.

Former Attorney General, and private practice lawyer, Ralph Kasambara: Amnesty International says his continued detention violates human rights and points to Malawi's worsening situation- Picture sourced from Ralph Kasambara's Facebook page

Ralph Kasambara was first arrested on Monday after a scuffle broke out when a group of five men allegedly attempted to petrol bomb his office in Blantyre, the country's commercial capital.

A day earlier, two national newspapers had quoted the lawyer as criticizing Malawi's President Bingu wa Mutharika.

"The rearrest of Ralph Kasambara indicates the Malawian authorities are willing blatantly to flout the law when it comes to dissenting voices," said Noel Kututwa, Amnesty International's Deputy Program Director for Africa.

"Such disregard for the judicial process is an alarming sign for the human rights of perceived critics of the government in Malawi, suggesting that the authorities are willing to stop at nothing to silence their critics."

On Thursday, Ralph Kasambara's lawyers Wapona Kita and Jonathon Kara were summoned by the directors of Malawi's Anti-Corruption Bureau to answer questions in relation to their client being granted bail.

"It would appear the authorities are pulling out all stops to ensure Ralph Kasambara remains in custody," said Noel Kututwa.

On Monday a group of five men carrying a can of petrol arrived at the prominent lawyer's office, asking people in the vicinity about his whereabouts. Five security officers responded to the scene, prompting two of the alleged attackers to flee.

The other three apparently admitted, after his security team used force, that they had been sent by government officials to attack Ralph Kasambara.

Police arrived at the scene and arrested the lawyer, his security team and the three remaining men. When they arrived at Blantyre Police Station, Ralph Kasambara and his security team were detained and charged with assault before being transferred to the city's Chichiri Prison.

The three men who were also arrested at his office are apparently no longer in custody, having been driven away from the police station in an unmarked car.

The next day, a Blantyre Magistrate granted Kasambara bail on 20,000 Malawian Kwacha (equivalent to US $120) on the condition he report to police once a week. He was returned to prison for one night before his release could be processed.

His release on Wednesday morning was delayed when police arrived at the Chichiri Prison with a search warrant and requested he accompany them to his office and home. He refused to go, but the search went ahead.

Kasambara was released on Wednesday afternoon and returned briefly to his home before armed police rearrested him and returned him to Chichiri Prison. No additional charges have been made.

Ralph Kasambara is one of a number of people in Malawi, including human rights defenders, journalists and civil society activists, who have been targeted since early 2011 for criticizing the government on issues including human rights, governance and the economy.

The intimidation has taken the form of death threats, forced entry to homes and offices, petrol bombings and other attacks. Threats have come from people who say they are aligned with the ruling Democratic Progressive Party (DPP) or by men believed to be state security agents.

Human rights defenders speaking at international forums and those involved in organizing anti-government demonstrations have been publicly criticized and threatened with violence and arrest by government officials, including President Mutharika.

Throughout 2011, Amnesty International spoke out against increased repression and threats to Malawians' freedom of expression, association and assembly.

Wednesday, February 15, 2012


14th February, 2012

The Malawi Chapter of the Media Institute of Southern Africa (MISA) is
disturbed with reports that journalists from state funded Malawi
Broadcasting Corporation (MBC) were barred from covering a function
organized by civil society organisations in Lilongwe today, February 14,

Reports indicate that civil society organisations, led by Human Rights
Consultative Committee (HRCC), organised a news conference to express
their concerns on the arrest of Human Rights Lawyer Ralph Kasambara but
refused to allow reporters from MBC to attend or cover the function.

The development was confirmed to MISA Malawi by one of the organisers of
the news conference who said MBC was barred because of its biased
reporting in favor of government. He said barring the reporters was one
way of advocating for change at the national broadcaster.

MISA Malawi would like to call upon civil society organisations to adopt
constructive strategies in advocating for change rather than being at the
fore in infringing on the Republican Constitution, which clearly provides
for journalists' right to access information.

Much as we agree with civil society organisations on MBC's bias towards
government, we believe Malawians are rational and capable of judging for
themselves whether a media house is biased or not. Barring reporters from
covering a news briefing is retrogressive and unwarranted in any democracy
worth the name.

Civil Society bodies should be in the forefront promoting and defending
constitutional guarantees and not flouting them. Barring some sections of
the media from covering functions could easily be construed as lack of
tolerance and deliberate and strategic to deny Malawians access to
opposing and critical information on our actions and plans. Such actions
could further mean that civil society organizations only want to deal with
media outlets that promote their cause, which is unhealthy and regrettable
in a democracy. Malawians need all sides to an issue to make informed
decisions and true democracy depends on the extent to which leaders
tolerate opposing views.

As we have always stated, MISA Malawi does not condone biased reporting
and neither does it encourage irresponsible journalism and if barring
reporters from covering functions has anything to do with professional
misconduct, we are more than willing to mediate.

We are therefore appealing to civil society leaders to exercise contact
and dialogue with media houses as well as media bodies that represent the
interests of journalists, whenever disagreements arise rather than
proceeding to breach provisions of the Constitution.

MISA Malawi is further appealing to civil society leaders to respect media
freedom and freedom of expression, which includes the right to be accorded
the fullest possible facilities for access to information.

We would also like to appeal to journalists both from public and private
media to remain professional and avoid serving the interests of one
section of society.

Anthony Kasunda

From CPJ: Uganda's Museveni issues warning to news media

By Mohamed Hassim Keita/Africa Research Associate

President Yoweri Museveni of Uganda lashed out at private broadcasters last week, accusing them of unethical reporting. The comments come in the midst of two important, ongoing developments: mounting public criticism of Museveni's policies and the government's criminal prosecutions of six journalists for their coverage.

"You rarely inform. You rarely educate. You entertain, yes. But you mostly lie and incite. I have so much evidence to prove all this," Museveni declared Friday while speaking at a dinner of Uganda's National Association of Broadcasters, according to the state-owned daily New Vision. The Office of the President's Media Centre quoted Museveni as saying that authorities would take "very serious" steps against media outlets seen as inciting public discontent with the government. "When you try to imitate the Western media," he was quoted as saying, "you will run into problems."

Museveni, a former guerilla commander in power since 1986, is expected to seek re-election in 2011.

Rachel Mugarura Mutana, who runs the independent Uganda Radio Network, has heard this all before. "He's said it more than once," she said. Fourteen months ago, in fact, the president singled out Monitor, Uganda's leading private daily, during his annual address to parliament. Waving a copy of an article critical of the government's dealings with an international investor, Museveni accused the paper of undermining national interests and said it had "no right to damage our future."

In some respects, radio journalists would seem an unlikely target for the president's most recent salvo. Local journalist Charles Bichachi told CPJ that some irresponsible statements could be heard on live radio debate programs, but he said the president's criticism was largely unwarranted as it pertained to news coverage. Mutana said that while radio stations offer people forums to express themselves, they lag behind newspapers and television in current affairs coverage. This is due to financial constraints (which tend to limit current affairs coverage in favor of inexpensive music programming) and the relatively few journalists adequately trained in radio journalism, she said. Nevertheless, a call-in radio program questioning police handling of unsolved murder cases led officers to interrogate Ssubi FM Editor-in-Chief Bashir Kazibwe twice last month, according to the local press freedom group Human Rights Network for Journalists.

Museveni's comments come amid public criticism of a government policy proposal on land and political rights in Uganda's oil-rich western region. The criticism stems from Monitor's publication of a leaked presidential memo proposing to restrict political and land rights to the ethnic Banyoro, whose traditional kingdom is the site of intense oil exploration.

The government did not dispute the contents of the memo, although spokeswoman Kabakumba Matsiko told local and international media that the document was misrepresented "as if it was a final decision." Monitor acknowledged some errors and published a correction. Nevertheless, police have interrogated Managing Editor Daniel Kalinaki, Sunday Monitor Editor Henry Ochieng, and reporter Emmanuel Gyezaho on accusations of "uttering a false document," according to defense lawyer James Nangwala.

Two other Monitor journalists were arrested recently on criminal charges related to their work. Moses Akena was detained on August 10 and charged with criminal defamation in connection with a corruption story. On July 21, Inspector General of Government Faith Mwonda had Monitor photojournalist Stephen Otage arrested for taking photographs of her outside a courthouse. Police seized Otage's camera and charged him with "criminal trespass." Mwonda is also the plaintiff in a criminal libel lawsuit against four Monitor journalists who raised questions about her salary in 2007.

In this context, many local journalists have expressed fears of a renewed government crackdown on the media in the run-up to elections in 2011. "We're anticipating things to heat up in the next few months especially as [Museveni] prepares for elections," said local journalist Bichachi. Mutana of Uganda Radio Network described the president's remarks as a proverbial cracking of the whip ahead of the election cycle.

One award-winning political editor, who suffered the whip of repression four years ago and currently faces at least 21 criminal charges in relation to his coverage, said he is undeterred. "I write what I think," Andrew Mwenda told CPJ. "I leave it to the government to think about what they will do."

UPDATED: We corrected Henry Ochieng's title after a commentator pointed out that he is Sunday Monitor editor.

Mohamed Keita is advocacy coordinator for CPJ's Africa Program. He regularly gives interviews in French and English to international news media on press freedom issues in Africa and has participated in several panels. Follow him on Twitter: @africamedia_CPJ.

From CPJ: Attack on South Sudan reporter sparks critical debate

By Tom Rhodes/CPJ East Africa Consultant

February is the hottest month in Juba, the capital of South Sudan, and Mading Ngor, a reporter and presenter for the Catholic-owned Bakhita FM, trudged his way through the heat to cover parliament proceedings last week--only to be thrown unceremoniously out of the assembly. "Before I had time to argue, four security guards pinned me to the ground and dragged me across the floor, tearing up my trousers," Ngor, a hard-hitting, critical journalist, told me.

The ensuing furor included apologies, a protest, an opinion column, a committee investigation, parliamentary debate, the banning of Ngor from the assembly, and finally, a parliamentary call to revive deliberations over three media bills originally drafted five years ago. While some journalists see the resurrection of those proposals as a silver lining, others -- including Ngor -- are worried that debate over the bills in this heated atmosphere may spell trouble for press freedom in the world's newest country.

"If they do it now, it will not be the same bills we had hoped would pass," Ngor said.

It all began, Ngor says, because he sat in the wrong place. Normally he sits in the public gallery, but as he arrived on February 6 the legislative assembly was reading out motions. "So I opted to sit in the other section in the back -- the whole row was empty." An unidentified security officer ordered him to be removed from the parliament premises. After Ngor attempted to reason with the security officer and finish his reporting, he was thrown out by thuggish force.

"This case is getting unwarranted media attention," Ngor says, given that such incidents happen all the time in South Sudan. "I remember last September the security almost murdered me for taking a picture in the assembly." Later he found that there was no official protocol banning photography in the assembly hall. Indeed, South Sudan has already developed a reputation for allowing security operatives to abuse civilians with impunity, including journalists. CPJ documented nine cases of security attacks against journalists last year; in two cases the journalists had to be hospitalized for treatment.

After Ngor was ejected, Member of Parliament Joy Kwaje, chair of the Assembly's Information Committee, apologized and promised to investigate the matter, according to local reports. Speaker James Wani Igga and some other MPs denounced the brutal action. Ten journalists marched to Kwaje's office, according to local reports, and took the opportunity to air their grievances over prior abuses. "Including a female reporter, Mary Ajit from the Citizen," Ngor said, "Security slapped her in the face for no reason some time back."

"I am of the view that this incident has set the launching of the struggle between those in the halls of power and those who love freedoms, including of expression, because what was attacked was [not only] an individual, but freedom of expression as well as the bill of rights," Chief Editor Nhial Bol of the private daily Citizen, wrote in a scathing column. The editor was admonished by MPs for claiming in his op-ed, incorrectly, that they were "celebrating the beating of our colleague."
Ngor hosts 'Wake Up Juba,' a morning talk show on Radio Bakhita, pictured. (CPJ)
Ngor hosts 'Wake Up Juba,' a morning talk show on Radio Bakhita, pictured. (CPJ)

Despite the initial round of apologies, the committee who investigated Ngor's removal quickly dashed hopes for justice. "During the investigation, we found out that Mading had more than 10 cases with the security personnel of the National Legislative Assembly," Kwaje was quoted as saying by the online Sudan Tribune. She also said Ngor had refused to identify himself after security asked, according to local reports.

Some of the committee's alleged findings against Ngor, however, sounded specious. "One of the guys [in the committee] claimed I always came drunk to parliament but I have never even met him," Ngor told me. One of the findings read out by Kwaje to the Assembly last week claimed Ngor was a freelance journalist and did not work for Bakhita FM, local journalists told me. Apparently none of the investigative committee listen to his popular morning talk show on Bakhita FM, "Wake up Juba," where Ngor conducts interviews with top political officials of South Sudan - including the Secretary General of the ruling party, Pagan Amun.

Parliament ultimately decided to ban Ngor indefinitely from the assembly after the committee's findings, he said.

Many local journalists I spoke to suspect the decision to ban Ngor is rooted in his professionalism as a journalist. Ngor's "Wake up Juba" program explores issues few journalists venture to touch, such as corruption within government circles.

Ngor grew up in Alberta, Canada, studying journalism at Grant MacEwan University. "I came [to South Sudan] as a journalist because independence is the story of the century, and I wanted to be part of that. After losing my relatives in the war I felt a sort of moral obligation to contribute to the country," he said in an interview with The Seattle Times.

Meanwhile, MP Kwaje, among others, called on the executive to bring the media bills back to parliament, local journalists said. The three proposals, which would initiate a public broadcaster, create an independent press ombudsman, and provide greater access to information, have been bouncing back and forth between the ministry of legal affairs and council of ministers for years. "Without media laws we are like footballers playing without rules, and what happens is that anybody can blow the whistle and say these are the rules -- his rules," said Jacob Akol, chairman of the Association of Media and Development in South Sudan, which supports the laws' passage.

Columnist Zechariah Manyok has concerns. "What guarantee will the media have that the bill is not going to be based on the anger of the Assembly, making it a law against the media [rather] than a law meant to regulate the activities of the media?" he wrote in the Sudan Tribune.

"It has not been easy and will not be easy at the moment for the media in the newest country," said freelance journalist Anthony Kamba, who hopes the publicity surrounding Ngor's incident will foster change. "It will only turn out to be a safe haven when the media laws are passed," he said.

Tom Rhodes is CPJ’s East Africa consultant, based in Nairobi. Rhodes is a founder of southern Sudan’s first independent newspaper. Follow him on Twitter: @africamedia_CPJ


14th February, 2012

The Malawi Chapter of the Media Institute of Southern Africa (MISA) is
disturbed with reports that journalists from state funded Malawi
Broadcasting Corporation (MBC) were barred from covering a function
organized by civil society organisations in Lilongwe today, February 14,

Reports indicate that civil society organisations, led by Human Rights
Consultative Committee (HRCC), organised a news conference to express
their concerns on the arrest of Human Rights Lawyer Ralph Kasambara but
refused to allow reporters from MBC to attend or cover the function.

The development was confirmed to MISA Malawi by one of the organisers of
the news conference who said MBC was barred because of its biased
reporting in favor of government. He said barring the reporters was one
way of advocating for change at the national broadcaster.

MISA Malawi would like to call upon civil society organisations to adopt
constructive strategies in advocating for change rather than being at the
fore in infringing on the Republican Constitution, which clearly provides
for journalists' right to access information.

Much as we agree with civil society organisations on MBC's bias towards
government, we believe Malawians are rational and capable of judging for
themselves whether a media house is biased or not. Barring reporters from
covering a news briefing is retrogressive and unwarranted in any democracy
worth the name.

Civil Society bodies should be in the forefront promoting and defending
constitutional guarantees and not flouting them. Barring some sections of
the media from covering functions could easily be construed as lack of
tolerance and deliberate and strategic to deny Malawians access to
opposing and critical information on our actions and plans. Such actions
could further mean that civil society organizations only want to deal with
media outlets that promote their cause, which is unhealthy and regrettable
in a democracy. Malawians need all sides to an issue to make informed
decisions and true democracy depends on the extent to which leaders
tolerate opposing views.

As we have always stated, MISA Malawi does not condone biased reporting
and neither does it encourage irresponsible journalism and if barring
reporters from covering functions has anything to do with professional
misconduct, we are more than willing to mediate.

We are therefore appealing to civil society leaders to exercise contact
and dialogue with media houses as well as media bodies that represent the
interests of journalists, whenever disagreements arise rather than
proceeding to breach provisions of the Constitution.

MISA Malawi is further appealing to civil society leaders to respect media
freedom and freedom of expression, which includes the right to be accorded
the fullest possible facilities for access to information.

We would also like to appeal to journalists both from public and private
media to remain professional and avoid serving the interests of one
section of society.

Anthony Kasunda

Monday Victories

On Monday, February 14, the world registered some victories on various issues. Here is a summary:

...After hearing from more than 82,000 people, Chase Bank called off foreclosing on 78-year-old grandmother and civil rights activist Helen Bailey. "I feel like a weight has been lifted off my shoulders," says Ms. Bailey. "I am so thankful for the support of my neighbors and the nation."

...Last week Apple customers visited stores on four continents to deliver 250,000 petition signatures demanding better working conditions at factories making iPads and iPhones. (The delivery made news on CNN, the BBC, Al Jazeera, and NPR). Yesterday, Apple CEO Tim Cook announced immediate factory inspections, showing that the pressure is working! But experts doubt how reliable the monitoring group’s findings will be and there are still no worker-protection plans for new product releases (when workers are forced to work so hard to meet deadlines that some die of exhaustion -- and others commit suicide). Click here to sign Mark's petition and keep up the pressure on Apple.

...McDonald's finally responded to the 100,000 people (and groups like the Humane Society of the United States) who told the fast food giant to stop sourcing pork from factory farms using inhumane "gestation crates," (cages so small that pigs can’t move or turn around). McDonald's told all of its suppliers yesterday to start phasing out the cages -- an earthquake for the food industry.

...And some big news from last week! More than 141,000 banded together to save the life of Jesus Navarro, a father who was reportedly denied a life-saving kidney transplant, despite having insurance to pay for surgery, a volunteer donor, and a benefactor to help pay for his follow-up care. But an ABC News headline gives the good news: "Dying Dad, Jesus Navarro, to Get Kidney Transplant."

Tuesday, February 14, 2012



.Performance of Domestic Revenues
.Performance of Grants Performance of Expenditure

Domestic Revenue projection
Projection of Grants
Expenditure Projection


1. Mr. Speaker, Sir, and Honourable Members, I beg to move that this House do debate the Supplementary Estimates of Recurrent and Development Accounts for 2011/2012 Fiscal Year and that the estimates be referred to the Committee of the Whole Assembly, to consider them Vote by Vote; and that thereafter, they be adopted.


2. Mr. Speaker, Sir, I am delighted to stand before this august House and deliver my maiden budget speech, albeit at the mid year, to appraise the House and the Nation about our economic and budget performance in the first half of the Fiscal Year and present prospects to the end of the Fiscal Year.

3. As is customarily the case, Mr. Speaker, Sir, in this Statement, I will present in detail the performance and economic outlook of the Malawi economy. I will also elaborate on the challenges the economy is currently experiencing and highlight measures that Government is undertaking to address some of those challenges. Finally, I will report on the performance of the Budget for the first half of the 2011/12 Fiscal Year; and highlight major changes in financial allocations to the end of the Fiscal Year.

4. Mr. Speaker, Sir, before I do so, allow me first, to express my profound and heartfelt gratitude to His Excellency the President, Ngwazi Professor Bingu Wa Mutharika, for the trust and confidence he has shown in me by bestowing upon me the enormous responsibility of leading the economic management team of this Country at this particular point in time. I stand with utmost humility knowing the enormity of the responsibility, but I wish to pledge that I will do my very best to ensure that there is sound economic management and stewardship. Let me also sincerely pay tribute to His Excellency the President for the wise and dynamic guidance that I have received from him over the past five months that I have been in this position.

5. Mr. Speaker, Sir, I am also greatly indebted to my Cabinet colleagues and Members of this House from both sides, who at various times, have offered their views regarding policies we need to undertake in order to sustain the economic gains that the country achieved in recent years. This is very encouraging and it demonstrates that despite our political differences, we realise that Mother Malawi is bigger than each one of us and that we can come together and constructively contribute to matters of national importance.


6. Mr. Speaker, Sir, in order for the House to understand the background within which the Mid Year budget review has been undertaken, there is need to appreciate the global economic environment within which we are operating. When the 2011/12 budget was being presented in June last year, economic analysts the world over, were optimistic about prospects for a global recovery. Six months later, the world economic recovery has become much more uncertain and the optimism that characterized late 2010, and much of 2011, has waned.

7. According to the most recent World Economic Outlook (WEO) update from the International Monetary Fund, global financial conditions have deteriorated, growth prospects have dimmed, and downside risks have escalated. Global output is projected to expand by 3.25 percent in 2012, a downward revision of about 0.75 percentage points relative to the September 2011 World Economic Outlook. This is largely because the Euro Zone economy is now expected to go into a mild recession.

8. Mr. Speaker Sir, as a result of this uncertainty, output growth in the developed world has been revised downwards from the initial projection of 2.0 percent in 2012 to 1.2 percent for the same year. In fact, this global slow down is even evident in Japan where for the first time in 30 years, they will register a trade deficit.

9. Mr. Speaker, Sir, through the contagion effect, growth in emerging and developing economies is also expected to slow down because of the worsening external environment and a weakening of internal demand. It is projected that growth in emerging and developing economies will drop from about 7 percent in the first half of 2011 to about 6 percent in 2012. Natural disasters, wars and high inflation rates in many parts of the world are seemingly the major constraints to economic progress in the world.


10. Mr. Speaker, Sir, coming to the regional economic outlook, the IMF estimates that the Sub Sahara African region (SSA) is poised to continue expanding in the near term, provided that the recent rise in financial and economic instability in major advanced economies is contained. Real GDP growth in the Sub Sahara African region will remain strong and is projected to average between 5.25 and 5.75 percent during 2011 and 2012, albeit with considerable differences across the region. Average growth for the Low Income Countries (LIC) group was projected at 6 percent in 2011, on account of strong domestic demand and accelerating exports. In 2012, growth is expected to increase to 6.5 percent as investments strengthen across
the Sub Sahara African region. However, there has been a marked increase in inflation especially in East Africa and some central African countries which pose a risk to the projected growth in the Sub Sahara African region.


11. Mr. Speaker, Sir, coming back home, I have chosen to give an account of our macroeconomic performance by giving highlights in each of the four sectors of the macro-economy.

Real Sector Performance

12. Mr. Speaker, Sir, real GDP growth for 2010 reached 6.7 percent, driven by mining and quarrying, wholesale and retail, accommodation and food services, and information and communication. In 2011, although the growth rate slowed down slightly, the economy continued to perform relatively well, with projected real output growth of 6.0 percent per annum. This growth was underpinned by solid performances in agriculture, forestry and fisheries sector, mining, construction, and financial and insurance services. In the face of escalating international fuel prices, reduced disposable income due to lower tobacco prices, scarcity of foreign exchange and intermittent power supply, the economy slowed down in 2011 from the initial growth projection of 6.9 percent to 6.0 percent. This level of growth,
Mr. Speaker, Sir, is however, strong and above the average for Sub Saharan Africa.

13. Malawi’s other leading indicators of economic wellbeing have remained favourable. Although Malawi experienced adverse economic conditions, inflation has remained within single digits. However, with pressure on non-food components especially transport, it was expected that annual average inflation for 2011 would edge up from the initial projection of 7.0 percent to 7.6 percent.
External Sector and Foreign Exchange Reserves.

14. Mr. Speaker, Sir, I now come to developments in the External Sector. While exports represent 21 percent of Gross Domestic Product (GDP), imports represent 36 percent of GDP implying a trade deficit of 15 percent. This has affected Malawi’s ability to accumulate foreign exchange reserves so that between July and December 2011, Malawi’s official foreign exchange reserves averaged 1.9 months of import cover but ended at 1.5 months of import cover. The marginal performance of the foreign reserves can principally be attributed to poor tobacco sales during the season.

15. Mr. Speaker, Sir, shortage in foreign exchange has repercussions for the importation of strategic inputs especially fuel,fertilizer and pharmaceuticals. For example, in the first half of the year, Malawi has been able to uplift only 55 percent of national fuel requirements.

16. Mr. Speaker Sir, it is our expectation that in the second half of the fiscal year, the fuel situation will improve. The National Oil Company of Malawi (NOCMA) has intensified its efforts to mobilize resources for the procurement of fuel. Once these efforts succeed, then we will have further improvements in the fuel situation.

Monetary Sector Performance

17. Mr. Speaker, Sir, I now turn to the monetary sector. Monetary policy in the first half of the Fiscal Year continued to focus on maintaining low inflation, while providing a conducive environment for financial deepening and private sector growth. In general, interest rates remained stable, with the bank rate at 13 percent and treasury bill yields hovering between 5.5 percent and 7 percent. In August 2011, the Monetary Authorities adjusted the Malawi Kwacha exchange rate from MK150 per US dollar to MK165 per US dollar.

18. Mr. Speaker Sir, I am pleased to report that we have made significant strides in the area of financial inclusion. In the past six months, Government through the Reserve Bank of Malawi facilitated the signing of a Memorandum of Understanding with Commercial Banks on Financial Inclusion. We also launched the World Bank-funded Financial Sector Technical Assistance Project, which will greatly contribute towards increasing access to financial services, making payment systems more efficient and interoperable, improving regulatory framework and increasing financial literacy in Malawi. In the second half of the fiscal year, we will conclude the design of the Financial Deepening Trust, which will be co-funded by the UK’s Department for International Development (DfID), the United States Agency for International Development (USAID) and the World Bank. We are also finalizing the formulation of the second phase of the Financial Inclusion in Malawi (FIMA) project.


19. Mr. Speaker, Sir, let me now turn to the fiscal performance of the first half of the 2011/12 fiscal year. As Honourable Members are aware, in June last year, during the Budget Session of Parliament, the House approved the 2011/12 Fiscal Year Budget, comprising Revenues and Grants, amounting to K307.7 billion and Total Expenditure of K303.7 billion. A fiscal surplus of K4 billion was expected to be generated, and was earmarked for domestic debt repayment. I am pleased to report to the Honourable House that the overall performance of the Budget in the first half of the 2011/12 financial year was above expectations, in spite of the prevailing domestic, regional and global economic conditions. Both Domestic Revenues and Grants performed well above expectations while expenditures were within the set targets.

Performance of Domestic Revenues

20. Mr. Speaker, Sir, as the Honourable Members are aware, domestic revenues for the 2011/12 Fiscal Year were projected at K242.5 billion comprising K203.5 billion tax revenues and K38.97 billion non tax revenues. The target for the Mid Year was that a total of K115.6 billion comprising K96.1 billion tax revenues and K19.5 billion non tax revenues would be collected. I am pleased to report to the Honourable House that, as at 31st December, 2011, domestic revenues performed exceedingly well above the target. Domestic revenues amounted to K120.1 billion against a target of K115.6 billion representing an overall over-performance of K4.5 billion. Tax revenues amounted to K103.8 billion against a target of K96.1 billion thereby posting an over-performance of K7.7 billion while non-tax revenues under-performed by K3.2 billion. Mr. Speaker, Sir, tax revenues over-performed largely on account of efficiencies in the tax administration system by the Malawi Revenue Authority (MRA) while non tax revenues under-performed on account of shortfalls in fuel levies.

21. Measures that contributed to the overall over-performance of tax revenues included the following:

• Implementation of a Self Assessment System (SAS): This system has automated management of tax returns and computation of taxes due. This system is fully operational in the Large Taxpayer Office which collects around 80 percent of the tax revenues;
• Enhanced taxpayer service and education: Under this initiative, MRA is implementing a rigorous information dissemination campaign through targeted taxpayer meetings and discussions to enhance tax payer compliance;
• Improvement in enforcement activities: MRA has intensified its surveillance and enforcement activities through strengthening of the Tax Investigations Unit, Customs patrols and full application of stiff penalties on tax offenders;
• Intensification of tax audits: MRA has intensified tax audits for both local and multinational companies, including the establishment of a Transfer Pricing Unit in the Large Taxpayer Office, which has yielded significant results in revenue collection and enhancement of compliance;

• Restructuring of MRA: The restructuring of the MRA, which was completed in the previous financial year, is now bearing results. There has been notable improved efficiencies in a number of Departments and Sections which have enhanced the Authority’s effectiveness and efficiency in tax administration; and

• Enhanced information communication technology infrastructure: MRA has been stabilizing its ICT infrastructure and systems in the past 6 months. This has enabled the Authority to provide timely and better services to tax payers.

22. Mr. Speaker, Sir, allow me to acknowledge the technical assistance my Ministry and MRA received from the International Monetary Fund (IMF) Fiscal Affairs Department (FAD), the Africa Regional Technical Assistance Centre (AFRITAC) East, and the African Tax Administration Forum in implementing these reforms. Their assistance has been timely and invaluable and it has assisted us to achieve our revenue targets.

23. Mr. Speaker, Sir, I must candidly admit that the picture was not all rosy, and this is particularly so with non-tax revenues. As indicated earlier, non-tax revenues did not perform well during the 1st half of 2011/12 fiscal year, mainly as a result of under-performance of fuel levies on account of lower than planned fuel volumes. On a more positive note, the House might wish to note, Mr. Speaker, Sir, that although non tax revenues under-performed in the year under review, Departmental receipts continued to grow. Institutions that have performed exceptionally well as at mid-year include; the Immigration Department, the Malawi Police Service, Ministry of Industry and Trade, Department of Mines, Registrar General’s Department, Ministry of Information and Civic Education and Ministry of Health. Mr. Speaker Sir, Government will continue to implement reforms in the various Ministries and Departments so that efficiency is enhanced through automation and skills development.

Performance of Grants

24. As for Grants, Mr. Speaker, Sir, the total projection for the 2011/12 Fiscal Year is K65.2 billion, of which K19.8 billion are programme grants, K28.3 billion are dedicated grants, and K17.1 billion are project grants. By Mid Year, a total of K26.6 billion was expected to be disbursed, comprising K4.5 billion programme grants, K13.5 billion dedicated grants and K8.5 billion project grants.

25. As at the end of the first half of the financial year, a total of K26.7 billion was disbursed, comprising K19.5 billion dedicated grants and K7.2 billion project grants. Thus, despite the fact that the country did not receive any programme grants due to protracted negotiations with the International Monetary Fund (IMF) on the Extended Credit Facility (ECF) programme review, overall, grants over-performed by K150 million. The over-performance is largely attributed to the extra donor resources which were channeled towards the Farm Inputs Subsidy Programme (FISP) where an additional K5.3 billion was disbursed.

26. Allow me, Mr. Speaker, Sir, to report to the Honourable House that during the first half of the financial year, Government signed a number of Financing Agreements with various cooperating partners. These included the British Government which committed to provide £35 million, half of which, is for the Farm Inputs Subsidy Programme, for the next five years. DfID has, in fact, exceeded its pledged contribution to the FISP this year by quadrupling its support from £4.5 million to £19.5 million. The same is also true of the other development partners who are supporting FISP such as Irish Aid who trebled their support from €1.2 million to €3.5 million and Norway which almost doubled its support from 35 million Norwegian Kroners to 66 million Norwegian Kroners.

27. Mr. Speaker, Sir, the World Bank also committed to provide us with over US$240 million for the implementation of five important projects over the next four years and these are; the National Water Development Programme, Support to the Energy Sector, Support to the Mining Sector, Financial Sector Technical Assistance Project and Nyika Trans-frontier Conservation Project.

28. Mr. Speaker, Sir, let me also report to the Honourable House, that Development Partners, including DFID, Norway, Irish Aid and GIZ, have also pledged to support the Malawi Government with procurement of essential primary health care drugs. A sum total of $30 million has been set aside for this purpose between now and the next 18 months. The arrangement is that these drugs will be given to Government Hospitals for free but in return, the budgeted resources for procuring these types of drugs will be channeled to Central Medical Stores to build capacity of the Institution to stock sufficient drugs. For CHAM Hospitals, these drugs will be supplied at a much lower price than they would get from any Pharmaceutical company.

29. On behalf of His Excellency the President, I wish to express our profound gratitude to the development partners for all the support they continue to render to the people of Malawi. Their support is helping us in very substantial way in alleviating the suffering of our people, especially the poor and the vulnerable. The resources provided by our development partners are also complementing Government’s efforts in development initiatives across the country. It is on this account, Mr. Speaker, Sir, that I call upon this Honourable House to join me in thanking the development partners for all their support. To the development partners I repeat a Malawian saying which they have heard me use before: the path to a good man's house is never overgrown with grass, so they should bear with us if we repeatedly come knocking on their doors, seeking their kind support for our various development initiatives.

Performance of Expenditures

30. Mr. Speaker, Sir, let me now turn to the performance of expenditures in the first half of the 2011/12 financial year. As the Honourable Members may recall, in June last year, this House approved a financial plan for the 2011/12 Fiscal Year with expenditures amounting to K303.7 billion. Of these expenditures, K218.8 billion are recurrent expenditures, K15.0 billion are SWAp expenditures and K69.9 billion are development budget expenditures. In the first half of the financial year, total expenditures were projected at K178.2 billion, comprising K127.3 billion recurrent expenditures, K9.7 billion SWAp expenditures and K41.2 billion development budget expenditures.

31. I am pleased to report to the Honourable House, that actual expenditures stood at K178.1 billion, comprising K120.1 billion recurrent expenditures, K16.1 billion SWAP expenditures and K42.0 billion development budget expenditures. This outturn entails that Government spent as planned and well within the projected targets. In particular, recurrent expenditures under-spent by K7.3 billion, on account of expenditure control measures such as strict control on foreign and internal travel, freeze on motor vehicle purchases, among others. Overall, the development budget spent K800 million more than planned mainly on account of some projects which moved slightly faster than projected.

32. Mr. Speaker, Sir, as a result of strong performance in domestic revenues as well as prudent management of expenditures, the Zero Deficit Budget performed well above expectations. Recurrent expenditures were K120.05 billion against total domestic revenues of K120.09 billion, implying that domestic revenues exceeded recurrent expenditures by K40 million. Basing on a definition that recurrent expenditures are financed from domestic resources while development budget expenditures are financed from both domestic revenues as well as foreign receipts, then clearly the Zero Deficit Budget has so far been achieved. To the end of the Fiscal Year, the Budget process is expected to continue performing well considering that expenditures are normally lower than revenues in the second half of the Fiscal Year. This is based on historical and empirical data.


33. Allow me now, Mr. Speaker, Sir, to outline some of the key achievements Government made in the first half of the financial year.

Civil Servants Pay Rise

34. Government successfully implemented the 7 percent salary increase for all Civil Servants in Government Ministries and Departments. Government also paid monthly rural teacher allowances and arrears to all eligible teachers. As at 31st December 2011, up to K34 billion of Government own generated resources were used to pay salaries for public sector workers and allowances for rural teachers. Processes for recruiting professionals in various Ministries and Departments also progressed very well in the first half of the fiscal year. Notable Institutions that are undertaking major recruitment drive include; Ministry of Health, Ministry of Education, Science and Technology, Malawi Defense Force, Malawi Police Service, Immigration Department, Accountant General, Ministry of Agriculture, Irrigation and Water Development and the Anti Corruptions Bureau. Detailed accounts of how many professionals have been hired by these Institutions in this Fiscal Year will be presented in the main Budget Session of Parliament later in May this year.

35. While at this same point, Mr. Speaker, Sir, it will be remiss of me not to comment on the progress of the payment of salaries to Civil Servants through Banks. As the Honourable Members of the House are aware, in the last financial year, Government introduced the payment of salaries through Banks when it had noted that there were 20 ghost workers on the payrolls of various Ministries and Departments who were blotting the wage bill of Government. At the time, a total of 13,800 ghost workers costing Government in excess of K3.6 billion were discovered and removed from the payrolls. I wish to report to the Honourable House that although this arrangement had its own challenges at the begining, Government worked tirelessly in this financial year to resolve the challenges and ensure that all Civil Servants get paid in time and within the month they have worked. Government is also continuing to talk to Banks to move their services closer to the people in rural areas so that all public servants working there also get their salaries on time and without hustles. As for the perpetrators of the ghost workers phenomenon, I wish to report that relevant and competent institutions are dealing with the issue.

36. Let me also report to the House that another pay parade was also carried out in the first half of this financial year, this time around involving Pensioners. I wish to report to the House that in that pay parade, as in the earlier one on serving Civil Servants, ghost pensioners, obviously of a slightly older age group, totaling 1,132 and costing Government K113.8 million per annum were also established and deleted from the Pensioners Payroll. Government is also taking action on all those behind these elderly ghost pensioners.

The Farm Inputs Subsidy Programme (FISP)

37. Mr. Speaker, let me now report on the progress of the Farm Inputs Subsidy Programme (FISP) which this House approved and appropriated K21.9 billion in 2011/12 Fiscal Year. Using these resources, Government procured 140,000 metric tons of fertilizers comprising 70,000 metric tons of 23:21:0+4S NPK fertilizer and 70,000 metric tons of Urea which were distributed to over 1.4 million farm families across the country. These fertilisers were sold to farmers at a subsidized price of K500 per bag. To the end of the programme, a total of K23.5 billion is expected to be spent on account of the recent devaluation and increased costs of importing fertilizers. Let me also report to the House, Mr. Speaker, Sir, that the implementation of this programme has been reported to have substantially improved compared to the previous ones. It would appear that the Ministry of Agriculture, Irrigation and Water Development is recording improvements with each passing season.

Maize Purchases

38. Mr. Speaker, Sir, let me now report on the maize purchases by ADMARC. As the Honourable Members are aware, this House approved a provision of K1.2 billion for the purchase of maize from smallholder farmers by ADMARC. I wish to report to the Honourable House that as at 31st December 2011, ADMARC had procured 9,826 metric tons of maize using K388 million, leaving a balance of K812 million from the approved provision. ADMARC will use this balance to procure maize when the marketing season begins later in May this year.

Purchases of Chemicals

39. On purchases of chemicals, Mr. Speaker, Sir, as the Honourable Members may recall, the House approved a provision of K650 million for purchases of chemicals for storing grain for smallholder farmers. I wish to report to the August House that as at 31st December 2011, a total of 340 metric tons of chemicals were procured and distributed to smallholder farmers across the country.

Cotton Development

40. Mr. Speaker, Sir, let me now report on the Cotton Development programme which was approved by this House at the Budget Session of Parliament in June last year. As the Honourable Members may recall, the House approved a provision of K1.6 billion for this programme in 2011/12 Fiscal Year. Under this programme, cotton seeds and pesticides have been procured and distributed to smallholder farmers in order to boost their production and export of cotton lint to support generation of foreign exchange in this Country. I wish to report to the Honourable House that a total of 3,000 metric tons of cotton seeds and various pesticides have been procured and distributed to 418,000 farm families who have cultivated cotton seeds covering 195,000 hectares. Projections are that a total of 200,000 metric tons of seed cotton will be produced from this programme from April this year.

41. Let me also report to the Honourable House that in anticipation of the overwhelming response, under the Indian credit line, Government procured three Cotton Ginneries which will be operated under the stewardship of ADMARC on behalf of Government. These Ginneries will be installed in three belts of cotton production, namely, Chikhwawa, Balaka and Karonga. Installation of the Ginnery in Chikhwawa has already been completed and for Balaka, it is currently underway. Installation in Karonga will begin later this month. Once installed, it is expected that with the increased output of cotton, these Ginneries should assist in processing of cotton, which in turn, will assist in value addition and thereby assisting in foreign exchange generation.

The Greenbelt Irrigation Initiative

42. On the Green Belt Irrigation Initiative, Mr. Speaker, Sir, I wish to report to the House that Government through the Indian credit line has procured 177 tractors, 90 trailers, 144 maize shellers, 750 motorised pumps and 1,800 manual sprayers for hire and distribution to smallholder farmers. These equipments are expected to support the scaling up of production of various crops for domestic and export purposes. Let me also report, Mr. Speaker, Sir, that rehabilitation of old irrigation schemes and design and construction of new ones continued in the first half of the financial year.

43. On water retention structures and development, Government has completed the construction of Lichenza dam in Thyolo, Livuwo dam in Nkhatabay, Luvwere dam in Mzimba, Chivu dam in Thyolo and Nakhurukutu dam in Mulanje. Government has also constructed two motorized pump based irrigation schemes, four treadle pump based irrigation schemes and one gravity fed irrigation scheme, irrigating 119 hectors of land in the process. Government has also constructed 18 boreholes and surveyed 70 additional ones. This brings the total number of boreholes constructed to-date to 926 out of the 975 boreholes that were initially planned under the National Dispersed Borehole Construction Project. Plans are also underway to complete the Lweya and Mangochi sites for the Smallholder Farms Irrigation Project which are near completion.

Education, Science and Technology

44. Under Education, Science and Technology priority area, I wish to report to the Honourable House that a total of 4,360 conventional primary student teachers have been enrolled in Teacher Training Colleges and an additional 6,000 have been enrolled through Open and Distance Leaning (ODL) in the first half of the 2011/12 Fiscal Year. Out of these, 200 are Special Needs student teachers and will all be deployed to rural areas.

45. Under pre-primary and primary education, 352 classrooms, 86 Teachers' houses, and 36 administration blocks have been constructed and handed over while construction sites for additional 2,000 classroom blocks have been identified. In addition, 194 schools have been identified for the School National Meals Programme and tenders for the supply of food stuffs is currently in progress.

46. On teaching and learning materials, contracts have been awarded for the supply of Primary Education Teaching and Learning Materials and it is expected that by end of February 2012, 32 million exercise books, 60,000 desks, and 2,040 portable chalkboards will be distributed to various primary schools across the country. For Secondary Education, contracts for the supply of 313,120 textbooks for Secondary Schools across the country have also been awarded and signed.

47. Under secondary school education, construction of 4 Girls Hostels has been completed at Kasakula, Nachitheme, Chiwale, and Chamakala. Other sites still under construction are; Lukaladzi, Mbenjere, Wenya in Chitipa, Gawani, Kasiya in Lilongwe,
Chikhwaza, Chapananga, Nyamadzere, Michesi, Khongoloni, Mount View, Nyungwe, Utale and Nkhunga. I wish to report that construction in most of these areas is at an advanced stage.

48. Under the ADF V project, construction of 2 Community Day Secondary Schools (CDSS) has been completed and handed over; 3 CDSS have almost been completed except for grass planting and solar/ESCOM connection. On rehabilitation of schools, works have commenced on 6 CDSS, namely; Chikhwaza, Dziwe, Mseche, Namalomba, Nanjiriri and Nankumba. Maitenance works have also been completed in 6 secondary schools, namely; Misuku, Rumphi, Robert Laws, Livimbo, Mitundu, Mbizi and Bangula. The works are progressing well and contracts for the construction of Changoima CDSS in Chikhwawa and Khwalala CDSS in Mulanje have been awarded.

49. On the provision of Government scholarships, Mr. Speaker Sir, bursaries have been provided to 6,668 Conventional and Community Day Secondary School students and 188 students for Kamuzu Academy.

50. On Higher Education, construction of the Malawi University of Science and Technology (MUST) is at an advanced stage. Formulation of a curricula for this University is also underway. Let me also report that a contract for expanding infrastructure of the Lilongwe University of Agriculture and Natural Resources (LUANAR) has also been awarded to a Contractor who is currently mobilizing to go to the site. The University of Malawi has also doubled the intake of 1st year students who are supported under Government scholarship scheme. On Vocational Training, rehabilitation of workshops at Nasawa, Salima and Lilongwe Technical Colleges has also been completed, and progress of works at Soche is near completion. In addition, cadastral surveys have been completed and Topographical surveys are in process for the construction of three (3) Teacher Training Colleges (TTCs) in Rumphi, Mchinji and Chikhwawa. I am also pleased to inform the House that tendering has been completed, and a contract has been awarded for the construction of Phalombe Teacher Training College.

51. Mr. Speaker Sir, on Complementary Basic Education (CBE), I wish to report that 240 centres have been established, 600 facilitators and 50 supervisors trained. In addition, 62 motor bikes have been procured and distributed for Complementary Basic Education Supervisors.

Transport Infrastructure Development

52. On the road sub-sector, Mr. Speaker, Sir, I wish to report to the Honourable House that as at 31st December 2011, three road projects came to completion and these included; Bangula – Nsanje Road, Malowa – Goliati – Chiperoni Road and Bunda – Mitundu Road. Preparations for the opening of the Bangula – Nsanje Road are at an advanced stage. Apart from the completed projects, let me also report that Government is making good progress in the construction of Ekwendeni – Ezondweni – Mtwaro Road, Mzuzu – Bulala – Usisya Road and Chiweta – Mlowe Road. Progress in these roads is at an advanced stage. Tremendous progress has also been registered on the Lilongwe – Dedza – Nsipe Road, Mchinji – Kawere Road and Karonga – Chitipa Road. On the Blantyre – Zomba road, I wish to report that the Contractor has been identified and is currently mobilizing to commence work on this road while on the Lilongwe By-pass project, the process of identifying the Contractor is currently underway.

53. On the Zomba – Jali – Kamwendo – Phalombe – Chitakale road, Liwonde – Naminga road and Thyolo - Makwasa – Muona – Bangula road, I wish to report to the Honourable House that the two problems that had stalled progress on these roads are being resolved. The first was about replacing Consulting Engineers for these roads. I wish to report to the House that Consulting Engineers have now been identified for all the three roads. The second problem, especially concerning the Zomba – Jali – Kamwendo – Phalombe – Chitakale road and Liwonde – Naminga road was the issue of claims and escalations from the previous Consulting Engineers and Contractor. These claims were in excess of K4.5 billion for different reasons including idle time, change of scope and price escalations. I wish to report to the House, that Government with assistance from the European Union engaged the services of a Claims Expert who is currently in the Country reviewing and scrutinizing these claims. Once completed, Government will engage the Consulting Engineers and Contractors with the view to have the projects re-started. I am optimistic that this process should be completed within the course of the second half of the Fiscal Year.

54. On the Machinga – Chingale –Lirangwe road, I wish to report to the Honourable House that the road is currently under design stage until June 2012. Once this stage is completed, resources will be included in subsequent budgets for its construction.

55. Mr. Speaker, Sir, let me also report to the Honourable House that the projects on improving and refurbishing terminal buildings at Kamuzu and Chileka International Airports are progressing very well. In particular, works on the rehabilitation of the VVIP lounge at Kamuzu International Airport is expected to be completed in time for the African Union Summit slated for July 2012. Alongside these
projects, are also the International Conference Centre, Five Star Hotel and presidential Villas. These projects are also coming to completion and are therefore timely for the forthcoming African Union Summit.

Integrated Rural Development

56. Mr. Speaker, Sir, under Integrated Rural Development priority area, Government continued with the construction of Rural Growth Centres and Markets across the Country. Rural Growth Centres under construction are at Nthalire, Nambuma, Neno, Chitekesa, Chapananga and Mkanda. Works in all these Centres is at an advanced stage with some structures nearing completion. Under markets, construction works are taking place in the following places; Enukweni, Ekwendeni, Nkhamenya, Dwangwa, Mangochi, Limbuli, Bvumbwe and Thyolo markets. Progress in most of these markets is near completion.

Public Health, Sanitation and HIV/AIDS

57. In the Health Sector, Mr. Speaker, Sir, I am pleased to report to the Honourable House that Government released a total of K2.8 billion in the first half of the fiscal year for the procurement of drugs by the Central and District Hospitals. In the second half of the fiscal year, a further K1.8 billion will be released for this same purpose. These resources will be complemented by supplies of primary health care essential packages supplied by Development Partners to the tune of K1.5 billion, in the second half of the fiscal year.

58. Under Health Care Workers training programme in the country, Government continued with the support of training of all Nurses and other health care practitioners in CHAM Colleges and the Malawi College of Health Sciences. Government also continued to provide free Anti Retrieval Therapy (ART) to all those in need.

59. On capital development, Government continued with the construction of various infrastructure for health service delivery across the country. These included; the construction of various hospitals, the construction of Houses for health care personnel, and the rehabilitation of various health care facilities. Under Umoyo Project, Government completed the construction of 250 new houses for health care workers and rehabilitated another 250 houses. In the second half of the financial year, Government will commence with Phase two of the Project whereby Government will construct 5 Multi-story housing flats in Central Hospitals for internship health care workers, construct 76 Health Centres, and 140 extra houses for health care workers. This phase will commence once contracts have been signed.

60. Government also completed the rehabilitation of 22 Health Centres in the first half of the fiscal year. In the second half,Government plans to reach a total of 57 Health Centres. Government also continued with the construction works at the Malawi College of Health Sciences, College of Medicine, Kamuzu College of Nursing and CHAM hostels at Malamulo. Progress of construction in all these sites is variable. Construction at Zomba Campus of the College of Health Sciences is complete. Implementation progress at Lilongwe campus is at 95 percent while at Blantyre campus is at 55 percent. At both KCN Blantyre campus and college of Medicine Lilongwe campus, structures are at roofing stage while at College of Medicine Resource Centre at Blantyre campus is complete. I wish to report to the Honourable House that as for the Cancer Centre, significant progress particularly with ground preparation work. Scientific visits and consultative meetings with the International Energy Atomic Agency have successfully taken place. Land has been secured at Kamuzu Central Hospital for the construction of the Centre and a Consultant for designing and supervising the project has been engaged.

61. On the rehabilitation and construction of hospitals, let me report to the Honourable House that rehabilitation of Balaka District Hospital has registered good progress. So far, the VCT Centre, Isolation Ward and Kitchen have been completed while the paediatric ward is at roofing stage. At Zomba Central Hospital, construction of houses and flats has been completed and only await handovers. The eye clinic has also been completed and handed over. Construction of new Nkhatabay District hospital is also registering good progress. Several structures are currently at window level and in some structures, roofing has been completed. As for the construction of Phalombe, Dowa and Chikhwawa District Hospitals, and the rehabilitation of Queen Elizabeth Central Hospital, Kamuzu Central Hospital and Nsanje District Hospital, works will commence soon because much of the preparatory works have already been done. On the renovation of the Chauncy Maples, Mr. Speaker, Sir, let me report to the Honourable House that renovation of the vessel has started and it is expected that it will be completed and ready for sailing by July, 2012.

Youth Development and Empowerment

62. Mr. Speaker, Sir, in the area of Youth Development and Empowerment, I wish to report that a total of K519 million has been disbursed to 1,014 youths across the country in the period under review. Trainings in various business fields, including livelihood skills, have been provided to 850 Youths. These trainings, which were conducted under YEDF, were held in the following places; Masache in Chikwawa, Katuli in Mangochi, Mpherembe in Mzimba, DAPP Mikolongwe in Chiradzulu, Livingstonia Technical College in Rumphi, Area 25 in Lilongwe, Balaka, Blantyre, Salima and Mzuzu. In addition to the trainings, the Youths were also provided with start-up tools. Government has also distributed 220 push bikes to youth organizations across the country to ease their transportation problems.

63. Mr. Speaker Sir, on the Neno Integrated Development Initiative, Government continued to rehabilitate the former Neno MYP Centre into a national multi-skills youth development centre based on the Songhai Integrated Development Model in Benin. With the overall aim of turning the ‘youth bulge’ of Malawi’s population into a demographic dividend, Government plans to develop, through this Centre, the critical mass of young people with the level of skills required to build and manage their own enterprises along different agro-business chains and related industries. Regarding progress on the site, Government is constructing two hostels for boys and girls, a kitchen and a semi detached staff house and these projects are near completion.

Energy, Mining and Industrial Development

64. In the area of Energy, Mining and Industrial Development, I wish to report to the August House that design and construction of Kapichira II power station by Gezhouba, a Chinese company is underway and is progressing very well. Once completed, this station will generate an additional 64 megawatts which will bring the national total power supply to 348 megawats which is far much higher than the current suppressed demand of about 300 megawatts.
Mr. Speaker, Sir, Honourable Members, this additional power will inevitably stimulate industrial production across the country as well as deal with the current persistent black outs the Country is currently experiencing. In the period under review, Government has also launched the Energy Saver Bulb project under which 2 million bulbs will be distributed to manage power demand.

65. On the fuel storage facilities, I wish to report to the Honourable House that sites for the storage facilities have been acquired in Mzuzu at Sonda Industrial Area, in Lilongwe at Kanengo and in Blantyre at Kameza. Government is currently developing designs and securing resources for investing in these storage facilities. Construction works are scheduled to begin later in the year.
Local Development Fund

66. Mr. Speaker Sir, you are aware that in the 2011/12 fiscal year, Government through the Local Development Fund (LDF) has in the past six months been implementing a number of projects through the Community, Local Authority, Urban and Performance windows of the Fund. Under the community window, the Fund has been implementing five major projects, namely; the Primary School Staff Housing Project, the reconstruction of school infrastructure that was damaged by earthquakes in Karonga and Chitipa, the implementation of community Demand Driven projects (open Menu), Education Fast Track Initiative (FTI) and Enterprise Development activities.

67. Under the Primary School Staff Housing Project (PSSHP), Government is constructing teachers’ houses in rural areas. The objective of the programme is to improve the quality of education service delivery and enhance the quality of primary education through improved teacher to pupil ratio in the rural areas by attracting more teachers to teach in rural areas. In the 2011/12 fiscal year, government funded a total of 600 teachers’ houses and these are at various stages of completion. As of December 2011, overall completion progress was at 61 percent. Government is committed to continue with this programme and has provided K700 million in this budget towards the continuation of the construction of teachers houses.

68. Government is also constructing school blocks, teachers’ houses and VIP latrines in schools that were damaged by earthquakes in Karonga and Chitipa districts. So far, a total of 106 classrooms and 37 teachers’ houses have been completed under the first phase of the programmeme. Further, a total of 70 classrooms and 21 teachers’ houses are still under construction in both districts. Funding amounting to K287 million is still available in this year’s budget and
will be transferred to Karonga and Chitipa once they have completed the ongoing projects.

69. Mr. Speaker Sir, on the Community Demand Driven Projects, Government through the LDF is implementing other projects in various sectors including health, education, water and sanitation, agriculture and food security and several other sectors. These are small scale projects including road projects, bridges, health centres, guardian shelters, boreholes and other water points, school blocks, police units and many other forms of projects. These projects are very critical in meeting the direct needs of the communities. They are usually conceived and implemented by the communities themselves. Currently, a total of 153 of these sub projects are under implementation across the country. Based on the feedback we have received from the communities through beneficiary assessment studies and the Mid Term review which government and the World Bank undertook recently, communities are very happy with this kind of funding arrangement and government will engage the World Bank to explore ways of increasing the funding portfolio for these types of sub projects.

70. Mr. Speaker Sir, due to the impressive success that the Local Development Fund has registered in implementing development Projects at Local Levels, the World Bank has agreed with the Malawi Government’s request for the Local Development Fund to implement the school infrastructure component of IDA’s Education Fast Track Initiative Programme under the Improving Quality of Education in Malawi Project. Through the LDF, a total of 1400 classrooms and 400 teacher houses and 350 sanitation facilities will be constructed across the Country before the end of this financial year using decentralized structures. The World Bank has already made available a total of K3.8 billion for this purpose. These resources have already been made available to the Local Development Fund to commence the activities with immediate effect.

71. Mr. Speaker Sir, the Local Development Fund is also facilitating development of entrepreneurial culture in local communities through promotion of savings and investment culture in the communities. The current beneficiaries are mostly those under the Public Works Programme and few others under other government funded programmeme. So far, a total of 3,228 groups have been formed from Public Works beneficiaries with a total of 72,403 members of which 62 percent are females. As at the end of December 2011, all the groups had mobilized a total amount of K156, 789,471 (US$ 950,239). The average saving per member is K2,166. The savings are used for on-lending to finance small scale businesses.

72. Mr. Speaker Sir, under the Local Authority Window, the major focus is the Public Works Programme. The objective of the Public Works Programme is to increase incomes and food security of poor households who participate in the creation or rehabilitation of community assets. This is one of the measures that government uses to protect the poor from falling further into poverty. Between November and December 2011, a total of 250,000 households benefitted from this programme at a cost of MK600 million. The beneficiaries of the programme use the cash they get to purchase subsidised farm inputs thereby contributing to household food security that the country is enjoying. Since the programme started some three years ago, over one million households have benefitted from the Public Works Programme and about 6,923 community assets have been created.

73. Mr. Speaker, Sir, you are aware that the Urban Window is intended to finance socio-economic infrastructure in urban areas (potential economic growth points) to stimulate local economic development which are both labour and capital intensive as prioritised in the District Development Plans or Urban Development Plans. So far, Government through the LDF has made funding available for the construction of sports complex in Kasungu, the construction of Mbulumbudzi market in Chiradzulu and a bus depot at Lunchenza. In addition, a number of productive investments have been identified in the 4 growth centres of Jenda in Mzimba, Malomo in Ntchisi, Monkey Bay in Mangochi and Chiteketsa in Phalombe. These are soon to be tendered out so that construction works can commence.Proposals have also been made to all local Authorities to submit their projects for further financing.

74. Mr. Speaker, Sir, the Performance Window (Local Assembly Capacity Enhancement) is intended to strengthen Local Authorities organizational and institutional capacity for improved and innovative service delivery through the provision of incentives for good performance; and provide a mechanism through which capacity development activities at the national, Local Authourity, and community levels can be identified, implemented and monitored. Under this window, all Local Councils have been assisted to come up with Strategic Plans to help them better plan, manage and coordinate the development programme in their councils.

Parastatal Sector Performance

75. Mr. Speaker Sir, allow me now to report on the performance of the commercial parastatal sector. Government continues to closely monitor the performance of parastatal Institutions to ensure that they are able to deliver their services efficiently; that they do not pose a risk to the National budget and that they are self sustaining and able to remit dividend to Government; amongst other objectives.

76. Mr. Speaker, Sir, allow me to report to this August House that we have achieved reasonable success in this sector and we will continue to focus our monitoring efforts so that we consolidate on the successes achieved to-date and also ensure that lasting solutions are identified and implemented for those Parastatals that are struggling. A number of Parastatals registered profits and these included the Malawi Communications and Regulatory Authority, the Tobacco Control Commission, the Malawi Savings Bank Limited, Malawi Housing Corporation, Malawi Accountants Board, ESCOM Limited, Malawi Energy Regulatory Authority and Airport Developments Limited amongst others. Mr. Speaker Sir, I pleased to inform the Honourable House that in line with the objective of Government earning a return from its investments as a shareholder, during the past six months, the parastatal sector has paid dividends amounting to K1.4 billion to Government. Mr. Speaker Sir, this is the first time the sector has paid such an amount of dividends to Government in the history of the sector. I would therefore like to commend Management of the various parastatals that have paid these dividends and encourage others to emulate this example.

77. We will continue to review performance of the sector in particular those institutions that are facing challenges such as Air Malawi, ADMARC and the Malawi Rural Finance company just to mention a few.

78. As the House may recall, Mr. Speaker Sir, Government embarked on a parastatal restructuring programmememe whose objectives were to maximise on the synergies that existed amongst some parastatals and thereby reducing duplication of functions, ensure high levels of efficiencies in the delivery of service, reduce losses and therefore minimise the risk of dependence on the national budget. I wish to report to this August House that the exercise is underway and significant progress has been registered. At the inception of this exercise, it was clear that there was need for substantial legal and financial work to be undertaken so that the implementation process is seamless. This meant spending some time to come up with various legal instruments some of which will be brought before this August House for deliberation. Simultaneously, a number of administrative planning activities have now been finalized. Mr. Speaker Sir, I would like to assure the House that Government remains committed to ensuring that this exercise is brought to conclusion as soon as possible.

Pension Reforms

79. Mr. Speaker, Sir, on Pensions reform, I wish to report that following the passing of the Pensions Act, 2011, the response from the various Stakeholders including Employers has been very encouraging. Many Employers have complied with the provisions of the Act by providing pension to their employees. The coverage of employees on Pension has also substantially increased and this is expected to increase the national savings which will be used for development purposes. This will ultimately ensure improvement of the social welfare of employees after retirement.

80. Mr. Speaker, Sir, for smooth operation of the pension industry, awareness workshops have been conducted for Human Resource Practitioners, Trustees of Pension Funds and District Labour Officers. Work is in progress to also conduct workshops for Trade Unions, Industrial Court and human and accounting personnel in the Civil Service. Exemptions of some categories have been gazetted. Those exempted include seasonal employees, domestic workers, tenants, Members of Parliament in their own right and Expatriate employees with temporary employment permit (TEP).

81. Mr. Speaker, Sir, let me also report that formulation of the interim licensing guidelines and requirements for all Pension entities are in process. However, the services of a Consultant to assist develop and design the market structure of the Pension system that will enable the design of a comprehensive licensing requirements will be sought.

82. Mr. Speaker, Sir, the Act has exempted Government, as an employer, from complying with the provisions of the Pension Act for twenty four months from the date of commencement of the Act. This means that Government should be under the Pension Act starting from 1 June 2013. I am pleased to inform the August House, that my Ministry is hiring Legal and Actuarial Consultants to assist in designing and establishing a structure and a system for the Civil Service Pension scheme that will be in line with the requirements of the Pension Act.


83. Mr. Speaker, Sir, let me now turn to the prospects of the Budget to the end of the 2011/12 fiscal year. Total Revenues and Grants are now projected at K287.5 billion down from K307.7 billion at the Approved Budget stage reflecting a decrease in the resource envelop of K20.2 billion. This represents a fiscal contraction of 6.5 percent from the approved budget estimates.

84. Domestic revenue targets are being maintained at their 2011/12 approved budget estimates level of K242.5 billion, comprising K203.5 billion tax revenues and K39.0 billion non tax revenues. This is largely on account of the impressive performance of these revenues to Mid Year on account of efficiencies in tax administration and enhanced monitoring and enforcement. To the end of the financial year, despite the downward revision in Gross Domestic Product (GDP) from 6.9 percent as at the Approved Budget stage to 6.0 percent now, domestic revenues are expected to perform on account of efficiency factors. Additional efficiency factors expected to be implemented by MRA to contribute towards the achievement of the budgeted targets include: the installation of Scanners at strategic Boarder posts, improvements in procedures for assessment and collection of duty from imported motor vehicles, increased enforcement, modernization of tax operations through automation and capacity building initiatives. On the other hand, non tax revenues are expected to increase on account of measures such as: the automation of some revenue collecting Departments such as Immigration and Department of Civil Aviation; increased enforcement and monitoring of revenue collections; and the general improvements in the management and administration of Departmental fees and charges.

85. On Grants, projections to the end of the financial year are that they will be down by K20.2 billion. From the Approved Budget estimate of K65.2 billion, total Grants are revised downwards to K44.99 billion to the end of the financial year. This is mainly on account of two factors. The first is the delayed conclusion of the ECF programme review. As at the Approved Budget stage, the forecast was that within the course of the first half of the financial year, the second review of the ECF programme would be successfully completed and that a sum of K19.8 billion in programme grants and European Union (EU) Road Sector budget support amounting to K2 billion would be released. However, now that the ECF programme has not yet been concluded, it is unlikely that we will get these resources in this Fiscal Year even if the ECF programme review were concluded within the second half of the Fiscal Year. It is on this account that for purposes of being prudent, these resources have been removed from the resource envelope

86. The other major factor that has led to the downward revision of grants is the reduction in Health SWAp resources from an earlier estimate of K10.1 billion to K2.1 billion. It would appear that Development Partners have directed most of these resources towards the direct purchases of drugs under the primary health care which are being distributed to various hospitals in the Country. On the other hand, projections on Food Security grants and Education SWAp have all been revised upwards by K4.97 billion and K4.87 billion, respectively, on account of new pledges and disbursements by selected donors to these programmes.

87. Mr. Speaker, it is important for me to assure this House that government remains engaged with our Development Partners, including the IMF and the World Bank. In addition to despatching Cabinet ministers to various capitals for talks, His Excellency the President himself has been personally involved in discussions with representatives of our development partners. These discussions are aimed at arriving at a solution to our challenges that does not just involve devaluation alone, which as His Excellency has pointed out cannot be panacea for all our problems, but takes into consideration our deep-seated concerns about the impact of certain policy measures on the poor, and also takes on board our own views about the way forward. We are encouraged by the willingness of the development partners to engage in these discussions, and we hope we can reach consensus on a comprehensive programme that addresses the many structural aspects of our economy including supply side challenges.

Domestic Revenue Projection

88. Mr. Speaker, Sir, Government remains optimistic that the revenue collecting Institutions such as the Malawi Revenue Authority, Government Ministries and Departments will sustain this increased trend in revenue collection. Mr. Speaker, Sir, as these revenue collecting Agencies continue to entrench these reforms and revenue enhancement measures to ensure that the budget is on course.

89. Mr. Speaker, Sir, I wish to inform this Honourable House that there is still a portion of potential tax payers that needs to be brought into the tax net due to among other factors the continued growth of a thriving informal sector in the economy and some non-compliant tax payers. Allow me therefore, Mr. Speaker, Sir, to specifically inform this House that in addition to measures enumerated above, the Malawi Revenue Authority has also lined up a number of projects that are expected to make significant contribution toward the improvement in revenue enhancement and improve tax administration in the second half of the year. These projects include:

• Implementation of the Customs Central Declaration Processing Centre which will improve valuation and classification of goods by Customs;
• Interface between the Road Traffic Directorate and MRA motor vehicle clearing and registration systems expected to be implemented within the month of February, 2012;
• Installation of mobile container scanners at major border posts across the Country. Mr. Speaker, Sir, three scanners kindly donated to Malawi Government by the People’s Republic of China, have already arrived in the country and are expected to be operational in March, 2012.

90. Non tax revenues are expected to improve on account of measures such as: the automation of some revenue collecting Ministries and Departments; increased enforcement of revenue collections; and the general improvements in the management and administration of Departmental fees and charges.

Expenditure Projection

91. Mr. Speaker, Sir, in line with the projected revenues and grants, total expenditure and net lending has been revised downwards from K303.7 billion to K299.9 billion. Total wages and salaries have slightly edged upwards from K66.2 billion to K67.9 billion to take into account arrears for rural teacher allowances as earlier-on alluded to. Goods and services have been revised downwards by K7.9 billion from K114.2 billion to K106.3 billion on account of the savings from the expenditure control measures such as the reduction in the size of Cabinet, strict control foreign and internal travel, ban on purchases of luxury goods and strict control on motor vehicle maintenance and use. Resources for the Farm Inputs Subsidy Programme (FISP) have been increased from K21.6 billion to K23.3 billion to incorporate the effects of the recent exchange rate adjustment while pensions and gratuities have been slightly reduced by a billion from K12 billion to K11 billion due to the efficiencies made in disbursing these resources. Development budget expenditures have slightly increased from K69.9 billion to K70.2 billion reinforcing Government’s commitment towards improving the development architecture of the Country. The reduction in the resource envelop has generally reduced the surplus in the Approved Budget estimates which was intended to repay domestic debt. Government will only reduce its domestic debt by K400 million from K124 billion at the start of the Fiscal Year to K123.6 billion. Otherwise, all other adjustments in the Budget are being accommodated in the Budget using savings from the expenditure control measures.


92. Mr. Speaker, Sir, let me now comment on the budget lines with reasonable adjustments:

(i) Reduction in Expenditures Targeted by Expenditure Control Measures

93. Mr. Speaker, Sir, as the Honourable Members of the House are aware, in the first half of the fiscal year, Government implemented expenditure control measures which I have already referred to. As a result of these measures, Government made savings in excess of K11.7 billion on these expenditure lines. To avoid these resources being abused or used for other unintended activities, adjustments have been made in all the Votes to reallocate these resources.

(ii) Increase in Resources for the Education sector.

94. I wish to report to the Honourable House, Mr. Speaker, Sir, that the World Bank has given Malawi additional resources amounting to K5.6 billion for supporting the education sector in the Country. K2.1 billion of these resources have been given to the Ministry of Education, Science and Technology and Education Sector in the District Councils to implement various projects and programmemes in the sector while the balance of K3.5 billion has been given to the Local Development Fund (LDF) to construct primary school classroom blocks and teachers houses.

95. Let me also report Mr. Speaker, Sir, that resources for Subvented Organizations have also been increased by K680 million to carter for additional requirements for running the University of Malawi. As the Honourable House may be aware, the University of Malawi increased intake of Government sponsored students from 925 to 2,377. In order to ensure that all these students are properly supported by the University, additional resources were needed, hence, the increase on this Vote.

96. Mr. Speaker, Sir, let me highlight one important factor worth mentioning relating to the Government support to students in the public Universities in this Country. Government is providing at least between K1.0 and K1.5 million per annum per student. By all standards, regionally and globally, this is extremely high and it is therefore only logical that these students take their studies seriously considering the investment the nation is making through them. It is our duty therefore, to encourage the students to achieve their desired goals of attaining higher education which is vital for the development of this Country.

97. Let me also report, Mr. Speaker, Sir, that a provision of K500 million has also been made for the Water Supply and Sanitation project at the Malawi University of Science and Technology (MUST). As the Honourable Members of the House are aware, the Malawi University of Science and Technology is being financed by a loan from the People’s Republic of China, but as part of the loan agreement, Malawi is supposed to finance the water supply and sanitation system. Considering that the project is progressing much faster than previously anticipated, it has become necessary that the water supply and sanitation project takes off earlier than previously planned. It is on this basis that this provision is being made to kick start this project in the second half of this fiscal year.

(iii) Adjustments in the Health Sector Budget

98. As I already mentioned Mr. Speaker, Sir, resources in the Health sector SWAp account have been revised downwards for a number of reasons. First, some of the donors supporting the SWAp pool account have used part of their resources to procure directly primary health care drugs which are being given to various Government hospitals free of charge across the country. Secondly, Global Fund, one of the major donors in the SWAp account has also become discrete and is financing some of the programmes under the SWAp programme of work discretely. Coupled with the specific needs of various health facilities across the Country, adjustments have been made for the Ministry of Health Vote and Transfers to Councils for the Health Sector to reflect these changes.

(iv) Farm Inputs Subsidy Programme (FISP)

99. Mr. Speaker, Sir, as I mentioned earlier on, the Budget for the Farm Inputs Subsidy Programme requires adjusting upwards to take into account the extra resources required to carter for the recent currency adjustment as well as global increases in fertilizer prices especially UREA. A provision of K1.7 billion has therefore been made for increasing the budget for the Farm Inputs Subsidy Programme.

Tax Revenue Measures

100. Mr. Speaker, Sir, allow me now to comment on the tax policy measures that this Administration is implementing in the 2011/12 Fiscal Year.

101. I wish to inform the Honourable House that since the various tax policy measures were approved by this House during the main Budget Session of Parliament in June last year, my Ministry has been receiving a lot of comments on various policy measures from the general public, development partners, private sector, civil society, faith based organizations and other stakeholders. My Ministry has been reviewing these comments with keen interest and we continue to do so. Government acknowledges and sincerely appreciate all those contributions.

102. Mr. Speaker, Sir, we will continue with this process of consultation and come up with a comprehensive assessment and consolidation of the tax policy measures in the subsequent months for consideration in the next annual Budget. As the Honourable Members of the House are aware, it is customary for the Minister of Finance to make substantive pronouncements on new tax measures only during the main Budget Session of Parliament. Since this is only the Mid Year review, I will not announce any such policy measures now. However, given the nature of some of comments we have received, I would like to make clarifications on some of the tax policy measures that were announced in the 2011/12 budget statement in order to address implementation challenges that are currently being faced as follows:

(i) Income Tax – Minimum Tax Based on Turnover

103. Mr. Speaker, Sir, minimum tax based on turnover was introduced in the 2011/12 Budget statement. However, some implementation challenges regarding this tax policy measure were identified and needed to be addressed. Mr. Speaker, Sir, the spirit of the minimum tax, as stated in the 2011/12 budget statement, is to ensure that those companies that are perpetuary reporting tax losses contribute to Government coffers. It is Government’s intention, that this measure is implemented smoothly and fairly. In this regard, I want to emphasize the fact that implementation of the minimum tax on turnover will only apply to the companies perpetuary reporting tax losses. Mr. Speaker, Sir, allow me to caution that we are aware of tax planning activities and tax evading acrobatics that might arise as a result of this measure. I would like to assure this Honourable House that MRA is enhancing its capacity to conduct detailed risk based audits and other enforcement measures in order to seal revenue leakages.

(ii) Export Duty on Timber

104. Mr. Speaker, Sir, in the 2011/12 Budget statement, Government introduced export duty on timber at a rate of 50 percent. I wish to clarify to this Honourable House that the 50 percent export duty was meant to apply to exports of unprocessed timber in order to encourage value addition. To this end, Government remains committed to support timber millers who add value and export processed timber. In addition, new guidelines have been developed to ensure that our forests are harvested in a sustainable manner so that Malawi benefits from her precious timber export proceeds.

(iii) VAT Exemptions

105. Mr. Speaker, Sir, as was deliberated in the annual Budget statement for the 2011/12 fiscal year, the House agreed that VAT be removed on the following items; water supply, salt, meat and meat offal and other basic necessities. Mr. Speaker, Sir, as stipulated in the budget statement, Government is determined to streamline and consolidate our VAT regime in tandem with international best practices. In this regard, the following items which were erroneously liable for VAT, will now be included under the VAT exemption schedule; natural honey, eggs, and milk.

106. As I indicated earlier, Mr. Speaker, Sir, Government is committed to continuing dialogue with various stakeholders with a view to discussing the possibility of further tax reforms. It is in this context that Government will undertake a comprehensive review of the various proposals to ensure that policies promote growth in line with the Malawi Growth and Strategy Paper II.


107. Mr. Speaker, Sir, let me conclude by summarizing the main points of this year’s Mid-Year Review of the Budget. During the first half of the year, both domestic revenues and grants performed above their set targets. Since domestic resources exceeded recurrent expenditure, we can say that based on the principle of financing recurrent expenditure from own generated resources, then the Zero-Deficit Budget is on track.

108. In the second half of the fiscal year, Government expects that domestic revenues will equally perform as initially projected and at the same time, Government will make every effort to receive all planned donor resources to invest in the socioeconomic development of the country. Expenditure will continue to be controlled to the end of the fiscal year so that Government is able to meet all its 2011/12 fiscal targets.

109. Mr. Speaker, Sir, despite the adverse economic conditions which have prevailed, this Government remains optimistic that economic problems being faced are transitory and life for Malawians will soon return to normal. I wish to invite members of this house and indeed all Malawians to join hands and put our head together to ensure that Malawi sustain her economic gains and forges ahead in a manner that assures that we achieve the Malawi Growth and Development Strategy and Millennium Development Goals.

110. Mr. Speaker, Sir, I now must thank you and the Honourable House for your kind attention, for listening to my brief presentation. But in thanking you all, I am also mindful of the need for me, as a Minister, to listen. To listen, as I have done, to various stakeholders, especially our partners in the private sector and civil society, but also the Honourable Members of the Budget and Finance Committee. To listen to the Honourable Members on both sides of this august House. To listen to all and sundry, the humble and the mighty, the wise and the not-so-wise. To listen to those who agree with us but also, perhaps more importantly, to those who do not agree with us. I am mindful, Mr. Speaker, Sir, that listening has the potential to enrich all of us and increase our chances of working together, as His Excellency the President always reminds us, to find lasting solutions to the challenges we face. Of course, listening does not mean that one will agree with everything that is said, but listen I will, for I subscribe to the eighteenth century French enlightenment philosopher Voltaire, who said and I paraphrase: I may not agree with what you say, but I will defend to the death your right to say it.

111. Mr. Speaker, Sir, I humbly request the Honourable Members of the House to consider and approve the Revised Budget now before them.

112. Mr. Speaker, Sir, I beg to move.