President Peter Mutharika and his cabinet are taking a 10 percent pay cut to help boost resources for the COVID-19 response in the country.
The pay slash is one of key measures the Malawi leader announced in a bid to prevent the further spread of the COVID-19 and cushion citizens against its socioeconomic shocks.
President Mutharika announced the new measures in a televised address Saturday evening as Malawi has 4 people known to have the COVID-19, a disease caused by the Coronavirus.
The measures announced, he said, were to take effect immediately.
Moments after his announcement, the Malawi Energy Regulatory Authority (MERA) has already slashed pump prices of fuel.
Following the president’s announcement petrol, diesel and paraffin has since been decreased decreased by 33.04%, 20.61% and 27.18%, respectively.
A litre of Petrol is now selling at K 780.00 down from K 930.00, diesel is now at K 765.00 from K 887.00 while paraffin is now at K 625.00 a litre from K 693.00.
“I know that everyone is worried but I also know that we can survive this problem if we unite and fight,” he said.
The Malawi leader therefore announced measures to decongest work places.
“[A]ll offices shall work in shifts with the exception of those working in essential services,” declared Mutharika, saying the measures will apply to both government and the private sector.
He also suspended all formal meetings, gatherings and conferences, demanded proper ventilation for all infrastructure with public access and special consideration for employees with pre-existing medical conditions to be allowed to work from home.
The president will also free prisoners to decongest the country’s penitentiary facilities.
Mutharika has also reassured business captains that government will initiate measures to mitigate shocks caused by the Coronavirus.
“Therefore, government will take measures to protect jobs and incomes, protect businesses and ensure continuity of the supply chain and the survival of the economy,” he said.
He added that government will ensure implementation of measures that are unique to Malawi and Malawians.
“Government must listen to the private sector and the private sector must listen to us – just as I urge employers and employees to listen to one another,” he said.
He hinted that government will constantly keep engaging and listening to the private sector to develop and review various measures.
“Our goal is to protect the private sector, no matter how informal it may be, because our economy cannot survive without the private sector,” he stated.
Summary of the President’s Directives:
- The Malawi Energy Regulatory Authority (MERA) to reduce fuel prices with immediate effect to reduce transport cost.
- Reduce salaries of the President, Cabinet Ministers and Deputy Ministers by 10 percent for three months and direct the resources to the fight against the coronavirus
- Malawi Revenue Authority to open up a voluntary tax compliance window for a period of six months to allow tax payers with arrears to settle their tax obligations in instalments without penalty
- Provide a special fund to ADMARC to buy agricultural produce at competitive prices;
- Establish a Relief Fund through which well-wishers, companies and individuals can support the fight against Coronavirus;
- Apply tax waivers on importation of essential goods for Coronavirus management. These include personal protective equipment, hand sanitizers, soaps, water treatment chemicals and many more;
- Waive tourism levy to support the tourism industry;
- Waive non-resident tax on all foreign doctors and medical personnel;
- Increase the MEDF loans allocation from K13 billion to K15 billion in order to help Micro, Small and Medium Scale businesses that have been seriously affected by the pandemic;
- Increase Nutrition Allowance payable to civil servants with foundational medical conditions by 50 percent;
- Reduce fees and charges on all electronic money transactions in order to promote use of electronic money transactions;
- The Ministry of Health to recruit 2,000 health workers to assist in the fight of the pandemic.
- Increase the risk allowances for our health workers as a matter of urgency.
- Ministry of Agriculture to ensure that Auction Holdings Limited functions normally to operate the tobacco marketing season and protect tobacco farmers.
- The Reserve Bank to mplement a win-win arrangement with commercial banks and Micro-Finance Institutions to observe a three-month moratorium on interest and principal repayments for all loans contracted by Micro, Small and Medium Enterprises;
- RBM cushion the foreign exchange market to ensure availability of forex and stability of the foreign exchange rate;
- Activate an Emergency Liquidity Assistance framework to support banks in the event of worsening liquidity conditions.
- Government to discuss with Malawi Confederation of Chambers of Commerce and Industry and the Tourism Association of Malawi for win-win arrangements that will ensure that there are no redundancies in companies.
The Malawi leader said he had held discussions with institutions such as the SADC, COMESA and other regional trade blocks as well as neighbouring countries to ensure smooth transportation and importation of essential goods and raw materials into Malawi.
He also talked of the need for enhanced customer protection in the wake of the COVID-19 pandemic in the country.
“I hereby direct the Competition and Fair Trading Commission to increase surveillance and protect consumers from anyone who wants to unfairly increase prices of essential goods,” he said, warning that unscrupulous traders will be punished.
So far, four people have tested positive for the COVID-19 after about 100 tests.
Three people, two of them without travel history but linked to someone with a travel history to India and a Blantyre-based 19-year-old boy with a travel history to the United Kingdom are the known cases.