Malawi’s decision to devaluate currency swells poverty, says charity group

London, 6 Jul – (ANA) - British anti-poverty charity, War on Want, today warned that Malawi’s decision to devaluate its currency is swelling poverty.  As Malawi celebrates 48 years of independence today without official pomp and splendour, such austerity measures are in line with the recent devaluation of the currency by 49% to secure a three-year US$ 175 million loan from the International Monetary Fund, War on Want said. This has caused prices to skyrocket in a country that largely relies on imports. Meanwhile, the Malawian Congress of Trade Unions is fighting for a 40% wage increase for the formal sector. However, about 88% of Malawians work in the informal sector, where wages are not fixed and the devaluation has squeezed their already meagre profits, shoving them further into poverty. The devaluation was one of the first acts of the new Malawian president, Joyce Banda. Banda is the country’s first female president and Africa’s second woman head of state. The devaluation came to win back international support in a country heavily reliant on aid, after her predecessor, Bingu wa Mutharika, shunned this backing, going so far as to expel the British high commissioner. (ANA)

FA/ANA/06 July 2012----------