Suzanna Kathumba, a domestic worker in Malawi, spends every day thinking of ways to economize her limited salary of 80,000 kwacha ($46) a month to support her family. As she wipes down furniture in her Lilongwe home, she reflects on her latest strategy to save money: "I've told my youngest children not to get too dirty when playing so we can save on soap," the 43-year-old mother of four lamented. However, her efforts are challenged by the innate curiosity and energy of children.
For several months, Ms. Kathumba, a divorced mother with little financial help from her ex-husband, has struggled to make her salary last, particularly against the backdrop of rising commodity prices. Most of her earnings go to her four children, who live in the town of Kasungu, around 130km (80 miles) from the capital. This includes the two youngest still in school, while the older two are unemployed.
According to recent reports, Malawi's annual inflation rate is at a staggering 27.7%, marking a slight decline from April's 29.2%. Ms. Kathumba notes, "Salaries are staying the same, but prices keep going up every day. The money finishes before it even comes. We're living a very hard life."
As shoppers witness continual price increases, an Ernst & Young report identifies Malawi as part of a "hyperinflationary economy," alongside nations like Venezuela and Sudan. The report predicts cumulative inflation rates of 116% through December 2024 and further declines in subsequent years.
The World Bank classifies Malawi among the poorest nations globally, estimating that 70% of its population survives on less than $2.15 daily. The ongoing cost-of-living crisis has left many, including Ms. Kathumba, with no savings. "There is absolutely nothing left at the end of the month," she confessed, as her salary must cover tuition fees, food, and basic necessities.
Economists attribute Malawi's inflation crisis to a shortage of foreign currency in the banks, which limits the importation of essential goods. Domestic exports do not generate sufficient forex, creating a fiscal imbalance.
It is not only consumers who struggle; business owners are similarly impacted. Mohammed Hanif Waka, who operates a stationery shop in the capital, has seen a decline in customers as prices soar. "Sales have drastically dropped," he shared, as businesses are compelled to substitute expensive imports with local goods due to forex constraints.
Earlier this year, informal traders protested in the streets over the deteriorating economic environment and the lack of profits. An IMF loan of $175 million was also temporarily suspended due to unmet policy conditions, further straining the country's economic outlook.
Despite challenges, the Malawian government is attempting to address rising prices in anticipation of national elections in September. Future plans include measures aimed at regulating price inflation and providing foreign exchange to registered businesses. However, skepticism remains among citizens regarding the effectiveness of these policies.
With lofty hopes, Ms. Kathumba calls on politicians to remember the plight of the vulnerable while making economic decisions. "We depend on the government for assistance," she stated, echoing the sentiments shared by many struggling families.
