Home Forex Exchange UPDATE 2-Malawi president, ministers take 10% salary cut to fight coronavirus – Reuters

UPDATE 2-Malawi president, ministers take 10% salary cut to fight coronavirus – Reuters

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(Adds details on package plan, quotes)

BLANTYRE, April 4 (Reuters) – Malawi’s president and cabinet will take a 10% salary cut and redirect the money towards the fight against coronavirus, President Peter Mutharika said on Saturday as he announced a stimulus package in an address on state television.

Mutharika announced a number of measures aimed at cushioning small- and medium-sized businesses, including tax breaks, a reduction in fuel prices and an increase in risk allowances for health workers.

Mutharika also ordered tobacco markets to be opened and allowed to operate without disruption to protect small farmers and bolster foreign currency receipts. Tobacco is Malawi’s chief foreign currency earner.

“The coronavirus attack has a huge negative impact on the economy and businesses everywhere. There are many business people and industry players who are uncertain about the situation as it is unfolding. I know that everyone is worried,” he said.

“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.”

Amongst other measures, the president directed the Reserve Bank of Malawi to allow banks to offer a three-month moratorium on interest payments on loans to small- and medium-sized businesses.

He also ordered the country’s Competition and Fair Trading Commission to put in place strict monitoring of price controls and punish anyone found increasing prices at the expense of Malawians.

“The government will continue monitoring and review situation as it infolds,” Mutharika said.

He also ordered all non-essential service providers in both the government and private sector to work from home with immediate effect.

On Thursday, Malawi recorded its first three confirmed cases of the coronavirus. On Saturday, the number rose to four.

The President also directed the central bank to “cushion the foreign exchange market to ensure availability of forex and stability of the foreign exchange rate,” and work on an emergency liquidity assistance framework to support banks in the event of worsening liquidity conditions.

The government will also increase loans under the Malawi Enterprise Development Fund that will help micro, small and medium scale businesses that have been seriously affected by the pandemic to 15 billion Malawi kwacha ($20.69 million) from 12 billion kwacha.

$1 = 725.0000 kwacha
Reporting by Frank Phiri; Editing by Angus MacSwan, David
Clarke and David Gregorio

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