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Malawi saved its democracy but not its economy

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in many parts global democracy can seem as abstract and immutable as the mountains in the distance; voting is not a triumph, but a concern. But not in Msundwe, a thin strip of road lined with stalls selling beans, maize and cabbage, about 40 minutes’ drive from Lilongwe, Malawi’s capital. Here, democracy feels as fresh and real as the scars people still carry from the beatings, shootings and mass rapes of three years ago.

“People in this area rebelled against the previous government,” says Kandwani Mangani, a 25-year-old motorcycle taxi driver. “Then the police came and taunted people.” According to an official report, police officers viciously tried to quell protests against the rigging of the presidential election by Peter Mutharika, who was the sitting president at the time, shops were looted and at least 18 women were gang-raped.

In 2020, Malawi’s Constitutional Court annulled the election and ordered a repeat vote. Lazarus Chakwera, a theologian and reformer determined to end corruption and spur growth, won. Malawi’s strong defense of its democracy was widely seen as a victory for the rule of law in a region cursed by autocrats. It also ignited hope for the recovery of this land of some 20 million people, which has stubbornly remained the poorest peaceful country in the world.

Still, the first two years of Mr. Chakwera’s term provide a grim picture of how difficult it is for even a well-intentioned leader to root out entrenched graft and reinvigorate a sclerotic agrarian economy in the face of climate change.

Mr. Chakwera, who oozes natural charisma and speaks with the intonation of an American evangelical preacher, admits he has made no progress on his top three priorities: creating jobs, creating wealth or improving food security. The main reason, according to him, was the “consortium of crises”. First, the COVID-19 pandemic hit the economy, reducing growth from 5.4% in 2019 to 0.9% the following year. Then came Ana, one of the tropical storms that are increasingly hitting the country (see diagram). It washed away crops, damaging food production as well as hydroelectric plants that provided 30% of Malawi’s electricity, leading to blackouts. The third was the war in Ukraine, which pushed up the prices of fertilizer and fuel, two of Malawi’s biggest imports, straining its foreign exchange reserves. Now we are running out of fuel and fertilizers. “My dream didn’t come true as it was supposed to,” says Mr. Chakwera sadly.

Exogenous shocks and natural disasters largely explain why Malawi has been struggling of late. But that does not explain nearly six decades of slow growth since independence in 1964, leaving Malawi GDP only $545 per person.

Part of Malawi’s problem is that it is small, landlocked, resource-poor and dependent on neighbors that are often in conflict. Paul Collier, a development economist, argued that Malawi would struggle to get rich even if it had better governance and policies. Stéphane Dercon, another development economist, estimates that per capita growth has been just 1.5% per year for almost seven decades. “Achieving such low rates requires a special effort,” Mr. Dercon noted wryly in his recent book, Gambling on Development.

This effort was made by a small elite that is equal parts predatory and dependent on the statist politics of Hastings Banda, the former dictator of Malawi. The gang liked to control every detail, from the length of women’s skirts to the prices of agricultural products. Although Malawi got rid of Banda’s dictatorship in 1994, it has yet to free itself from the dead hand of his interventionist state.

Approximately 80% of Malawians still make their living from the land. Instead of encouraging farmers to freely choose what to grow and sell, the government intervenes by setting prices (which people ignore), occasionally banning exports, and handing out bags of fertilizer and seeds to the poor, whether they want it or not, at a price of 1, 5% from GDP. Researchers at the International Food Policy Research Institute estimate that importing a bag of corn would be five times cheaper than importing the fertilizer needed to grow that bag.

One of the reasons why subsidies continue against common sense is ideology. Lobin Lowe, the agriculture minister, says they need to ensure Malawi’s food self-sufficiency “not only at the national level but also at the household level”. Another reason is certainly the juicy profits that can be made from fertilizer contracts.

Mr. Chakwera has launched a crackdown on bribery by backing the new head of the anti-corruption bureau, who is pushing hard to investigate the case, which allegedly involves politicians, judges and journalists. But even if corruption is reduced, it will not be enough. It is necessary to free up agricultural markets; regulations that make it harder to do business or create jobs must be cut. “Malawi’s biggest problem,” says an experienced Western diplomat, “is that its government keeps interfering.”

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