Malawi in a Shifting African Landscape

Malawi in a Shifting African Landscape

Courtesy: Don Pollard

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Malawi

Heads of State and Government

Peter Mutharika, president of the Republic of Malawi, joins J. Reed Kramer, chief executive officer of AllAfrica Global Media, to discuss his country's  politics, policies, and the most pressing issues currently facing the nation and the region. The president recounts his personal jouney to the presidency and Malawi's recent political history. He goes on to discuss the country's role in southern Africa, its prospects for economic growth, and policies his government is pursuing to make Malawi more attractive to foreign investors. Mutharika additionally addresses corruption, poverty, environmental issues, and the United Nations' new sustainable development goals.

KRAMER: Good morning. Welcome, everyone. I’m glad to see we have a full room here.

And we welcome everyone to the Council on Foreign Relations to hear from President Mutharika. As you know from your handout, he’s been president of Malawi for about 15 months. And you know more—there’s plenty of information there about his background, so I won’t take up precious time with that. He and I are going to exchange for a few minutes before we call on you, but get your questions ready because we will be going to the audience shortly.

Welcome, Mr. President. We’re glad to have you here for your first visit to the Council.

MUTHARIKA: Thank you.

KRAMER: And we’d like to start by asking you to share with us your experience over the first 15 months in office. What have—what do you believe you’ve been able to accomplish? And you can also share with us some of the disappointments you might have encountered, because they’re always there in the job that you have.

MUTHARIKA: Thank you very much. First of all, good morning to you all. I’m very glad to be here.

As you know, in the interest of transparency, that I lived here for over 50 years. I first came here as a graduate student, unable to go back home because of the political situation there. For the next 50 years, I worked in this country as a professor of law at one of your leading universities, until I retired in that profession. In 2009, I resigned to go back—I retired, actually, to go back to Malawi, where I ran for office and became a member of parliament, and then I became minister of justice, minister of education, and minister of foreign affairs. In 2011, our president died, so suddenly thrown into the opposition. And I’m sure you know the story of that. And then I ran for president in 2014, and here I am, 15 months later.

So I’m very glad to be here. As I say, I lived here for a long time. I always hoped that I’d be invited to the membership of Council on Foreign Relations. It never happened, but I’m glad now to come in through the back door. (Laughter.) I can see some of my friends here, still, and others. So I’m very glad to be here.

Malawi, as you know, is in southern Africa, a country of 15 million people. It became independent in 1964. For the first 30 years, we had a dictatorship. In 1994, we had a first-time democracy. We have since had five presidents, and I’m the fourth elected president. So we do have democracy now, but it’s a challenge around democracy in our situation, where traditions for democracy are not there. In the African situation, as you know, we have the chief, we don’t have a vice chief of deputy chiefs. The chief runs the country. So that’s a tradition. What do you do to opposition and so forth? But when democracy came with support of—we all struggled for independence together. But so we’re divided into two groups. One is running the government, and the other one opposing the government. So it is very difficult. It’s sort of artificial. So we’ have had a very different situation on nurturing democracy, but in the process we are finding (our own ?) democracy.

Let me say this, first of all, that in 1994 we adopted the democratic constitution. And I was one of the authors of the constitution. What we did was to adopt the American system of government—presidential system—but at the same time we have the president elected for a term of five years and can be elected for another 10. But at the same time, we also adopted a prime minister system in the sense that members of the Cabinet are drawn from parliament, and there’s no administration. So it’s a mixture. Sometimes it works and sometimes it doesn’t work because of the contradictions that exist in that kind of system.

However, we have managed to create a number of democratic institutions. For example, the Human Rights Commission, a very important body, and also the (Ombudsman ?). We have those bodies, and also Anti Corruption Bureau, that are supposed to assist us in the governance of the country. And so far, it’s working quite well.

Now, on the economic front, I think this is where the challenges are. Some of you may have read in the newspapers that two years ago there was a situation in the government whereby the previous government was involved in massive looting of the treasury, known as Cashgate, after the Watergate, of course—Cashgate here. So I had a situation whereby the government was pretty much bankrupt. The donors left because of the Cashgate. They left. And the donors provide—used to provide 40 percent of the current budget. They left. So I had to run our government with a budget minus 40 percent. That has been extremely difficult.

How do you do it? So we started by, first of all, shrinking the government. I decided to reduce the government from a Cabinet of about 35 people to a Cabinet of 18 ministers. That helped save a lot of money, reduced from 25 ministries to 18 ministries. Then we cut back spending, especially travel. But every minister, including the president, can travel only outside three times a year, and don’t stay more than two weeks. I’m sure my ministers don’t like that, but they are tolerating that. And I think it’s working quite well in that front.

Now, we are trying to bring foreign investment in Malawi. With the departing of the donors, we thought we’d embark on a massive attraction of investment. So we’re now doing that. We had a very important conference in July this year, an investment conference. And we are trying to change the legal system—our laws—to make sure that investors are attracted. As you know, investors are concerned about two things: first of all, about the market; and secondly, about security—their own security.

With respect to market, Malawi’s a country of only 15 million people. So somebody says, oh, why should I invest in such a small market? And fortunately, Malawi’s part of a larger market. We are part of the Southern African Development Community, a common market for eastern southern Africa, and the Africa Tripartite Trade Area. That all brings in about 305 million people. We also access American market through the AGOA. Therefore, bigger market. We have access to the European markets through what they call EBA, Everything But Arms initiative. European market, and also we have access to the Chinese market, Japanese market, and Indian market through bilateral agreements. So here you add, it’s a huge, huge market. So investors should not worry that it will be a small market.

Now, on security, I think this is a major concern because I’m sure you read all sorts of stories about Africa insecurity and so forth, dictatorships. But I think Africa is changing now. I know the—Africa was seen as a burden, but I think now it’s seen as an opportunity because we have embraced—I was talking to Wall Street last year when I was here. I said that 20 years ago, as a radical young student, I considered capital an enemy. I would not have gone to Wall Street then. But Wall Street’s changed. Capital is now our friend. We have decided that the private sector, both domestic and international, is going to be a partner in the process of development in Malawi. So capital is welcome.

Now, with respect to the concern by investors that say—the second concern is about security, their own security—physical security, but also commercial security. In the case of physical security, I’ve assured that investors would be safe at home, at their place of work, and in between. We’ll make sure that the maximum physical security. And we’re doing that by increasing the police, improving the security situation.

Now, with respect to commercial security, the investors now are quite secure. No more nationalizations that you saw in the ’70s. Quite safe now. And we have a lot of legal system which is very protective. We are changing the administrative structures to make them more attractive. Before, it used to take 95 days from the time you applied for a license—investment license—to the time you start—(inaudible). Now it take only five days in most cases. I think the minister of commerce here would confirm. In most cases, within five days we can actually have an investment.

So there is security there. We have the rule of law. We have a viable judicial system, but also entered into a number of bilateral and multilateral agreements to protect foreign investment. A good example is the International Center for the Settlement of Investment Disputes of the World Bank. I’m probably the only sitting president in the world—I’m sure I am—who is also a member of the International Center for the Settlement of Investment Disputes of the World Bank, as an active member both on the conciliation and also on the arbitration. So we have the rule of law. And so there is—it’s safe there.

At the international level, we are participants very much in the international system within the region. But also beyond, in the African situation, but also in the United Nations. We participate in the United Nations, in the World Bank, International Monetary Fund, and various multilateral institutions. So we are very much now moving our country into the global constitutional framework.

We’re doing our best. Sometimes there are problems with meeting some of the international standards, like standards of human rights and rule of law. Sometimes we have difficulties, but we are doing our best. But in some cases, there are some of the international standards that we find difficult to accept because of our traditions. But we are working on those things, to make sure that Malawi becomes part of the global economic and political system.

Maybe I should stop here. I didn’t know that there was going to be an impromptu. I prepared a speech, which I was going to read, on democratization. But maybe next time, if you invite me again, I’ll read this speech. But this time—(laughs).

KRAMER: We’d be glad to take your speech and make it available. I’m sure have a lot of people would like to see it.

MUTHARIKA: This time I’m glad. I’m sorry?

KRAMER: Yeah, we’d be glad to take that speech and make it available. But I’m glad we can have this conversation. And I wanted to pick up on one of your first points, about the challenges that you face as a result of the withdrawal of donors. The British government, I think, sponsored an audit, which has been published now. And I’m wondering what the impact of that has been, and how is—are you able to repair the relationship with donors?

MUTHARIKA: You know, we’re trying. Yes, they did. In fact, they put a number of conditions for (replying ?). One of them was that we should cut back spending, which we’ve done as I mentioned earlier, cut back. A lean government, cut back on spending, and we are saving money there. And also reform the economic system—the financial system, we are reforming that to have more accountability, more auditing, and so forth. We are doing that.

The donors—actually, there are two types for budget support. We have the bilateral donors, which are Britain, Germany, and Norway, and Ireland. For multilateral donors, either the World Bank, the European Union, basically, and the African Development Bank. They all left.

I think we have met the all conditions we’re asked to make. I think we have made them. But only the African Development Bank has come back. I think that they will never really come back. I think the time has come with the donors themselves, facing difficulties with their own countries, their own economic situations, their own taxpayers, there’s no constituency really, whether here or Europe, for foreign aid anymore. So that’s the reality now. But we have good relations in the sense that we want investors from these country to come to Malawi and invest. But in terms of direct aid, no, I think—I’ll be very honest, I think it’s over as far as budget support is concerned.

KRAMER: And what about corruption? You had—there was two months ago, I guess, the murder of a senior official of the Anti Corruption Bureau, and there are still a lot of reports about corruption in this—your government, as well as previous ones.

MUTHARIKA: Yes.

KRAMER: Are you—is there—is there an upward motion against corruption, or is it something you can’t get rid of?

MUTHARIKA: No, we can get rid of it. We can, and we have a very strong—I appointed a very strong director. I fired the previous one. This man worked with Deloitte and Touche for 18 years. He’s an economist, a financial person, and he specializes in money laundering and fraud. So he’s now catching out on people. Many people have been arrested. Many people are being tried. Many people are being imprisoned already. So it’s working well.

With respect to Mr. Njauju, the number-three man in the Anti Corruption Bureau, it’s a very strange case. Very complicated, because it looked like the killing was very, very clever and very professional. So we’re working on that. There are some leads. We think that there will be a breakthrough.

But we are fighting corruption, no question about it. But you know, there will always be corruption, I suppose, in every society, in the sense that there will be some people who are always going to—you know, to have shortcuts to get riches. But I think there are serious penalties if you are caught, and I assure you that, and they know that I will not abide—that my government will not abide corruption.

KRAMER: And there have been a number of trials. It started, I think, before you came into office. But a number of people have been convicted, maybe 60 or 70.

MUTHARIKA: Indeed. Indeed.

KRAMER: OK.

MUTHARIKA: Ones who are convicted. About over 120 people are under investigation. And some are being tried, including our former attorney general, administrator of justice, as I say now, under trial, and many others. So, oh yes, yes. I have said that there are no sacred cows. It doesn’t matter who you are. If you are corrupt, we are going to get you. That’s the policy at the moment.

KRAMER: You mentioned the strengthening of democracy in Malawi. In democracies, one of the key things is that the losers can continue to operate and have a role. You’ve been in opposition yourself. What about your predecessor, Joyce Banda? She’s not in the country now. Is she welcome to come back, and?

MUTHARIKA: Very much so. She’s very welcome to come back. In a way, it’s a very sad situation. What happened, as you know, she succeeded my brother, under the constitution. And then, of course, she ran as an opponent. You know, trumped-up charges of treason. I was imprisoned for that, and then tried while I was campaigning. These charges were unfounded. After winning the election—very interesting—for hand over power, I invited her to come as normal to hand over power to me, and she refused. And Army commander handed over the symbol, which is—(inaudible)—to me, and so has refused to participate in it.

I know what you are saying, because she’s here—she’s right here in New York, and she’s telling people that I’m persecuting her. There is absolutely no truth whatsoever at all. However, I’ll say—and I’ll be very frank on this—I’ll say that the Cashgate happened during her administration. She was the president when this happened, and the purpose of this massive theft of money was to fund her political party for the campaign. So we have said whoever was involved in Cashgate, no matter who it is, if they’re found to have been involved, then they’ll be tried, and the rule of law will prevail. But it will be if someone has broken the law, but nobody will be persecuted for political reasons.

So going beyond that, I know what it’s like to be persecuted. I went through that for two years, and I don’t want to repeat that. We must move away from that to more tolerance. So she’s welcome to come anytime. And if you meet her—I know she’s attending the Clinton Initiative tomorrow—if you happen to meet her, ask her that she’s very much welcome to come back home. We need her there to contribute to the building of the new Malawi.

KRAMER: Do former presidents in Malawi have pensions and benefits of any kind, security?

MUTHARIKA: Yeah, they do. They do. In fact, they are entitled to about two-thirds of their former income. They’re entitled to one or two vehicles, some security, personal assistant, some household person. So they’re quite secure. And all that is tax-free. So they’re quite secure, yeah.

KRAMER: And so she has those things?

MUTHARIKA: Huh?

KRAMER: And she’s been extended those benefits?

MUTHARIKA: Yeah. Most of them have been extended, but some of them are being worked out. You see, it’s complicated. My brother died, what, three years ago? The family still has not receive the death benefits yet, simply because the process is very complicated. And—(inaudible)—history, when we drafted the Former Presidents Act, we thought that it would be talking about retired presidents. We did not know that at some point a serving president would die. So we were faced with a situation where there was no precedent and the law was not very clear.

So what I’m saying is she has received some of the benefits: the house she has, and all the vehicles she has. I’m sure, but the chief secretary can confirm—where is the chief secretary? The chief secretary can confirm that she has received those benefits. But the others she will receive when she gets back home. Security, for example, she has to be at home. We can’t send security people to New York to protect her here. I don’t think the U.S. government would allow somebody to come in the secret service. But she’s welcome.

KRAMER: So I wanted to turn to the economy and start with the situation with food. You made a national address very recently in which you told the Malawian people that there were at least 2.8 million suffering from hunger, and that you think the number is maybe even higher and could get worse. So what have you been able—what are you doing to address that situation? And tell us a little bit about what the cause of it is.

MUTHARIKA: Yeah, what happened was in February—actually, January 13th, it started raining and we thought it would just normal rain, that’s the rainy season, and suddenly it turned out that this was the worst rain in the history of Malawi. So a complete disaster—flooding, over 160 people were swept away, another 200 missing, everything was destroyed, the whole infrastructure in the southern part of the country. The northern part of the country, completely drought. Now, this is a very strange phenomenon.

I know tomorrow at the U.N. we’ll be talking about climate change. And this is a typical example of this phenomenon, that Malawi’s a country which is about 300—how many—about 700 miles long and about 50 miles wide. Half of it, rain, flooding. The other half, absolutely no rain at all. As a result, we lost about 60 percent of our crop. So it’s a difficult situation indeed. We expect close to 3 million people will have no food.

Now, I made an appeal, as you said, two days ago. The day I left, on Monday—and I must say, I’m very grateful that the U.S. government has responded with $50 million U.S. Actually we need $146 million and some—(inaudible). If you have a retirement fund, you are quite welcome to contribute to that—to that fund. But on a more serious note, we are looking for 146 million (dollars). We got 50 million (dollars) from the Americans today. So that’s a beginning. And we expect more donations from other governments, but also the private sector, both in Malawi and outside.

And I’ve assured the Malawi people that under my watch nobody would die from hunger. Nobody will. So we’re handling the situation, and I think we’ll be fine.

KRAMER: I’m sure this is a further strain on your economy. You’ve had a bit of a downturn in the growth rate. What do you foresee in this—in terms of growth in 2015 and going forward?

MUTHARIKA: Yeah, I think it’s going to be much slower than—we were expecting about 6-point-something, but I think it’s going to be less than that, maybe 5 percent. There’s some growth because of the problems of the currency, which is weak at the moment because the dollar has been too strong. So the currency is really affected, so it’s affecting that inflation and high price, and high interest rates, all the macroeconomic conditions. We are trying to control those. And we hope that, by the end of the year, we’re praying that the rainy season is coming in January that won’t have the same situation. I hope—for God’s sake, I hope this is the last time it happens, because if it does then we have a real, real problem on our hands.

We are praying that—we are beginning to rebuild now, we are beginning to reconstruct. We have a—actually a department of disaster management and resilience, and we are trying to get a situation of construction whereby we dam some of the rivers, so if this happens again we won’t have this water slipping now into the—into the Lake Malawi, that the reconstruction of these dams and so forth will be able to contain the water into the lake. So we are trying to do that, but it will be a long process and it’s expensive. But we’re working on that.

KRAMER: And this puts a strain on efforts to attain the development goals, of course, which is one of the things you’re discussing here in New York this week. Could you say a bit about what’s going on in Malawi on, let’s say, maternal and child health, on education, those kind of issues?

MUTHARIKA: Yeah, we will do our best. You know, the MDGs, how many were there? Eight, right? There were eight. I think we are a bit unrealistic in that we did not look at the supply side. When you said free primary education, when you think about training of teachers, infrastructure, buildings. When you said maternal health, we need to think about hospitals and doctors. So it’s not realistic, I think. That’s why it didn’t succeed as well as we hoped it would.

In Malawi, we have met four of the eight goals. We have met four of them. We didn’t meet the others. We have done better than most countries. Now, we are going to be discussing the 17 SDGs, as you say, beginning tomorrow. I think it will be more realistic. The problem is really resources, because the position taken at Addis Ababa two months ago and to be continued here is that most cases that all these goals, the funding must be based on domestic mobilization of resources. Now, that’s fine. But for a country like Malawi it won’t be easy to mobilize the kind of resources, the kind of money that’s required to fund these—the goals, the 17.

So tomorrow, beginning tomorrow, we’ll be making a case. We’ll be arguing, obviously, with our counterparts that we still need some sort of external resources; that it should be—while domestic mobilization is obviously commendable, that that should be the direction in the long run, but we also need actually infusion of capital from outside sources. So we’ll try to make our case on that.

But we are very excited about the new goals and with the 169 targets, and we hope that in 15 years we’ll achieve those. We are very excited. (In curing ?) AIDS, I’m chairing the panel—I’ll be chairing a panel on AIDS, the 90-90-90, hoping to achieve the end of the AIDS pandemic by 2030. So we are very concerned about that. But also children, nutrition, gender equality, and the youth empowerment. We’re working on those.

As you know, Africa is the youngest continent. Seventy percent of the population in Africa is under 25. And of those, of that population, maybe over 80 percent may not be well-educated and may not be able to find jobs. So we are facing a real challenge in how to integrate this huge population. How do we empower it into the economy with limited resources and limited institutions and limited job opportunities? So we’ll be working on those.

Myself, I have been appointed global youth champion. And I was telling my colleagues that I consider myself very young now, although I’m over 70—(laughter)—because of my position as a youth—I feel young in dealing with the youth now. But we’re working on those things. So there will be very interesting, serious discussions this week. I’m looking forward to that.

KRAMER: OK. Well, I’m going to ask—take questions now. I know there are a number of people here who would like to ask of you.

MUTHARIKA: Sure.

KRAMER: And so I’ll start on this side of the table. Right here.

Q: Mr. President, my name is Paul Tierney. I have an investment company focused on Africa, and also an economic development organization, a not-for-profit one, TechnoServe.

And my question is, what are your priorities? What do you think—not donations, but for foreign direct investment, what are some of your priorities? And where do you think that investment will come from—India, China, Europe, the United States?

MUTHARIKA: Yeah, very good. On the priorities, I wish we have the broad—after the Obama meeting last year I instructed the minister to prepare a compendium of all the bankable projects. And we have 123 bankable projects that are available in that book.

Now, in terms of priorities, first of all, power. We need power. We have a power deficit. At the moment we are going to produce about 350 megawatts and a lot of blackouts. Now, if we are going to attract investment, we need power. So investment in the energy sector is very important.

Secondly, infrastructure, obviously—the roads and the bridges, those kinds of things, investing in that. And then agriculture, being an agrarian country. We would like people to come in and invest, add more value in the many crops we have and others. Now we’re moving into other crops, legumes and so forth—big market for that globally. And we’d like people to invest, add value to that. But there are also areas like education where we need investors. So it’s a whole range of sectors that are really ripe for investment.

In terms of—but our priority—but you see, my brother used to say everything’s a priority in Malawi, but we have priorities within priorities, you know. So power certainly is one, infrastructure, agriculture, and mining. We’re moving—we have discovered that Malawi may have huge deposits of minerals. We have uranium, as you know. But we think we have gold, rare earth Niobium, and so many others. So the mining sector will be important. But for that function, we need power. It takes so much power.

Now, where the investors coming from? They’re from all over the world, as far as we are concerned. Our traditional friends—which is United States, Western Europe, Britain—those are obviously the traditional ones. But we’re having new investors now. The Chinese are investing. We have the so-called BRICS countries, and Brazil is one of the biggest investment in Malawi at the moment. But we negotiated, when I was minister of foreign affairs, a $2 billion investment in the railroad system. It’s from Brazil, very large. So those are the new emerging economies. And India also coming in, the new economy. So it’s a whole range.

And I will say that they are not mutually exclusive, that everybody is welcome to come there for the benefit. So it’s quite open, and as I’ve said, that we have certainly a regime—regulatory, administrative, where you make sure that everybody is secure.

Q: Speaking of power—

MUTHARIKA: Yes.

Q: Speaking of—

MUTHARIKA: We were expecting you to come.

Q: Hello, yeah. (Laughs.)

MUTHARIKA: You’re supposed to come.

Q: I’m coming. (Laughter.)

KRAMER: Please introduce yourself.

Q: Yeah. Paul Hinks. I’m the chief executive of Symbion Power, based in Washington.

I, of course, know President Mutharika since he came into office. And we’ve been looking at doing a couple of small biomass power projects in Malawi, but that’s not the question I wanted to really ask about.

As far as I know, there’s quite a large deficit of megawatts in Malawi, even today.

MUTHARIKA: Yes.

Q: And about 90 percent thereof of the power capacity is hydro. I’ve heard lots of different stories about coal, about different types of energy, about interconnections from Mozambique. What is the current plan for addressing the deficit of power in Malawi? Because those small biomass plants is not going to do that. I’m more interested in what is the large-scale baseload because solar, as we know, is not baseload. It works during the daytime. And wind is not baseload. So what baseload power solution is Malawi looking at to get out of this situation that it’s in right now?

MUTHARIKA: Yeah. You know, first of all, you’re right. I mean, for 100 percent really, maybe 99 percent, is hydro. As you know, we had problems. When we had the floods, you know, there was a lot of silt and the turbines stopped, and we went down to only 90 megawatts. It was a terrible situation. Right now, during the summer, water levels have gone down in the lake and also Shire River. About 90 megawatts cannot—we are at deficit now. So out of the 351, we’re actually, of that, minus 90. So it’s quite serious.

That seems to be the main power source at the moment, but we would like to diversify. We would like to go into coal. You see, coal I know in the western countries it’s not fashionable because of the clean energy, but we will try to make sure that it’s as clean as possible. Coal, and in the western part of Malawi near the Mozambique border, a lot of coal. And we hope we can use part of that. (Inaudible)—the dust, the coal dust, we make bricks for the housing (starts ?), as we have adopted.

So we’ll do that, coal, and we were also hoping solar. Now, as you know, solar—the trouble with solar is initially it’s very expensive, but also it takes a lot of space. You see, one megawatt, you need one hectare of land, and that’s a lot of space. To do that—we’re also trying to do that. And, of course, biomass. We expect by now that Symbion will be there.

I know you explained to the lady from South Africa, but that was a month ago. We haven’t yet heard from you. I think you were in Tanzania. She said you were in Tanzania at that time. But you are welcome, as you know. And I think you were thinking about 40 megawatts, 50 at the—initially, megawatts, you know, and also a connection with Mozambique. That part, when you and I talked about, the eastern part, along the lake, connect with the Tanzania system. That’s valuable. But also we’d be connecting with Mozambique and Zambia. If you do that, then eventually I would like to get into the Southern African Power Pool system.

But we do not do that unless, actually, the majority of generation is within Malawi. We don’t want to be like a country like Italy, for example, where they depend on another country for power. We don’t want to do that. So we want at least maybe 70, 80 percent to be within Malawi. And then we can sell and buy, you know, whenever there is a surplus, to the neighboring countries. So we’re trying to do that, and we hope we’ll be succeed. And then other off-grid, the small companies, some of the small ones, including portable ones and the others, (won’t be ?) connected with the grid, but can be using the rural areas—very useful for rural areas. You know, so we’re also doing that.

I don’t know if I’ve answered your question, though.

Q: Yeah. I think that you’ll hear a changing mantra over here about coal. There are 600-plus coal-fired power stations in the United States. There are more than 600 in China. And every time anybody mentions putting one coal-fired power plant in one African country, we all have a heart attack. What’s crazy about that is, you know, Africa has these indigenous fuel sources. It has coal and many other things that can be used. And often you see these emergency power situations coming in where they bring in diesel, and diesel produces worse emissions, if not controlled properly, than coal-fired power plants. So I think that what we’re looking at at the moment is to use indigenous fuel sources, whatever they may be, in the countries in Africa. And I think you’ll hear people over here now—I’ve been hearing it—saying what Africa needs is power, that’s the most important thing. Thank you.

MUTHARIKA: No, that’s very true. Yeah.

KRAMER: Gail.

MUTHARIKA: Yeah.

Q: (Off mic.) (Comes on mic.) Sorry, there.

KRAMER: Yes.

Q: Thank you.

I know nothing about the press in Malawi, and I wonder if you could tell us a little something about it. Certainly if you’re trying, over a long run, to build a democratic culture, the press is a huge factor. What can you tell us about the press in Malawi in terms of its impact on popular thinking?

MUTHARIKA: Yeah. Thank you very much, that’s right.

The press is completely free. Now, before 1994, as I mentioned earlier, we had a very authoritarian government. In fact, there was no free press. It was all government-controlled, including the radio station. In fact, the former government did not want television, only radio. Television came out since 1994.

The press is completely free. It might be too free. If you read the way they attack me—I’m sure if you check on the Internet you’ll find that I’m attacked viciously, and nobody—not a single person has been arrested. No member of the press has been arrested for attacking the government or—(inaudible). So they’re completely free. All we ask is that it should be responsible, but also they should be part of—they should continue to do the development process. They should not just be destructive. But, no, it’s free. And we intend to keep it that way as far as we are concerned, yeah.

KRAMER: Professionalization of the press is a major challenge across Africa, but it’s happening.

MUTHARIKA: Yeah.

KRAMER: Yes.

Q: Yes, Joel Mentor from Barclays.

I’ve read some interesting, inspiring stories about some of the Malawi citizens engaging in reforestation efforts, crop diversification developing local self-help institutions. So I’m wondering, what’s your administration’s strategy towards finding some of these local successes, and investing in those, and taking advantage of local initiative?

MUTHARIKA: Yeah. Could you repeat the last part of it—the first part of your question? You have heard about?

Q: So there’s basically a lot of stories of how Malawi—you know, citizens in your country are coming up with their own solutions to some of these problems in terms of food insecurity.

MUTHARIKA: Oh, yes. Yes. Yeah.

Q: So reforestration, crop diversification, and so forth. So in terms of—as opposed to just a centralized approach, how do you reinforce those local successes?

MUTHARIKA: Yeah. No, we are trying—good question.

First of all, we do have—we have set a system of decentralization. The things were too centralized. Now we’re decentralizing. For the first in the history we had tripartite elections, this last time for central government, for the present parliament, and local authorities. So the first time we have people at the local level, and that’s helping in terms of what you are saying.

Now, in terms of finding local solutions to—real local in the sense of a particular area, particular community, do that together with NGO(s). But I will say that, for example, if you are, say, an NGO—nongovernmental organization—from, say, Norway, but try to do the things within the national plan. The problem we have sometimes with the NGO is that a member of parliament—and I was a member of parliament before. You go to a constituency and you find that somebody’s building a bridge across a river because he told some chief and they agree we need a bridge there, although maybe a prenatal, you know, clinic would have been better. And so what I’ve said is, fine, localize, but let’s do that within national plan.

Now, on the question of—(I mentioned efforts ?), that’s a very important problem. I was here last year addressing—I think, Paul, you were there, at the congressional caucus in Washington. The country has been destroyed over the years through careless cutting of trees and so on and so forth. And we are trying now to reforest; a new conservation policy, conservation policy—planting more trees, also protecting the animals. But we feel without that—in fact, the flooding took place, to some extent—well, I mean, it was—it didn’t take place because of that, but I mean, it was destructive because we had destroyed trees and all those kinds of things, and everything was worse there. So we are trying to reforest the country, to build more trees along the riverbanks and so forth, to make sure that this doesn’t happen again.

I wonder if I’ve answered your question.

Q: Yeah.

MUTHARIKA: I have? OK, thank you.

KRAMER: Let me go to another side of the room. Down at the end. The lady right there.

MUTHARIKA: If you could mention your names, I would like to—

KRAMER: Yes.

MUTHARIKA: I know many of you by name, but if you can—

KRAMER: Everybody—

MUTHARIKA: —tell us who you are, it would be helpful, yeah.

Q: Okay. Graciana del Castillo from the Ralph Bunche Institute for International Studies.

Many of us admired your brother as president. He moved the country from hunger to a net exporter. And I was surprised you didn’t mention at all his policies that concern a large part of the population that is rural in Malawi. One of the things that happened during that period was that he had to defy many of the policies of the IMF and the World Bank and all that. And it was very interesting how it transformed the country in very few years with policies that we in the U.S. and in Europe, we use them for our own farmers, but are forbidden for countries in the developing world.

MUTHARIKA: Yes. Yeah.

Q: Could you please say more on that, please?

MUTHARIKA: Yeah. That’s a very interesting question because, in a way, I was part of the process of when—in 2004 when he won, I was there, and talking about what do we do about hunger. So he decided to have subsidies—subsidize maize, but also the seeds. Now, we were taught that subsidies are very bad. And there was a position, you correctly said, from IMF or the World Bank. But we argued that the Western countries—Japan has heavy subsidies; Germany; here. The—(inaudible)—support programs, since 1910 you have been supporting. And they were saying if you go to rural areas of this country, those—(inaudible)—that they’re being subsidized by somebody else.

So they tell us free-market forces only should operate. There should be no subsidies. Now we are saying, no, that’s not quite correct. I think the World Bank came around, and European Union after that, and agreed that some kind of subsidy was good as a temporary measure. It will not be permanent. Just like your welfare system here, the idea was to enable a person eventually have to stand on their feet.

So the idea was this, that we subsidize, for example, your crops, your maize. We hope you will grow enough maize so that you will be able to sell part of it, so next year you will not need the subsidy. That’s the idea. Now, it has not come out as well as we want it to because of other domestic and other conditions, other demographic factors. But that’s the idea. And I think it has worked well.

You are right that there was hunger—2001, 2002. But from 2007-8, we’re exploiting maize. We even send donated maize overseas, and rice. One country there was more than 100,000 tons of rice to a country overseas which was facing floods. So we’re able to do that. And now, because of these conditions I mentioned—the floods and the drought—things are all changed. It’s not the same.

I tell you what, when I was growing up, the rains used to come in October, and by Christmastime we’re eating green maize we use—(inaudible)—a lot those days. Nowadays, the rains don’t come until January, three months—if they come at all. And if they come, there is so much force, as happened this year, or no rains at all. So, in fact, we’re now moving into irrigation. We have—my brother started what they call the Green Belt. We’re planning to put over 500 hectares in each region—500,000 hectares in each region under irrigation. If that happens, we’ll move out completely from rain-fed agriculture to irrigation. So we are doing those kinds of things.

So there’s still intervention by the government in these kinds of things. We don’t believe that government should be totally indifferent or oblivious to these things, that only market forces should operate. I think—I think that’s going to be some kind of—you know, here, remember, during Reagan administration, he used to say that government was the enemy and so forth. But when 2007—come 2007-8, we found big companies—General Motors now going to the government for support. In the end, I think governments—every country has a role to play, even in a sort of free-market economy, some role for the government. So we are doing the same. But along the way, we’ll try gradually to allow the private-sector individual to take more—a bigger role than the government is doing at the moment. But there will always be some role, I think, for the government.

Yeah.

KRAMER: This corner here.

Q: Michaela Walsh from Women’s World Banking.

I kind of refer to the big elephant in the room, and I’d be curious as to—you know, among your policies, what policies do you have to assure that women’s voices are involved in the policies going forward in Malawi?

MUTHARIKA: Wonderful. That’s a very good point, I think. I myself personally just appointed—the U.N. has a HeForShe champion, global champion. And my minister here of gender, she’s very, very active in women empowerment. We have a number of private institutions to empower women, but I’m glad for women bank that you mentioned. I’m very interested in that. I think you have some operations in Malawi, I believe, right? Yeah, they do. Yeah. So I’m very interested in that, in empowering women.

First of all, a very interesting story. In 1997, a number of women came to Malawi to see my brother and said, look—(inaudible)—would like your support to be 30 percent, but especially by women, and across the board—in government, policy. So my brother said, no, I cannot support—30 percent, no, I cannot support. So they were taken aback. So he said, I will support you only if it’s 50 percent and not 30 percent. That’s how the 50 (percent) thing was born in Africa, and we’re supporting that. I personally convinced Michelle Bachelet, president of Chile, when she was at that time head of U.N. Women, to open the first U.N. Women office in Africa in Malawi.

So we are committed, no question about it. We are committed to women. Sometimes we don’t succeed because sometimes, for example, in parliament—when I was in parliament, we had 40 percent women. This last election, it went down to, what, 19? Twenty-two percent. For some reason, in spite of all this money coming in and your support women, it really went down. We don’t understand that, and we are looking to that. We have societies that have looked at the situation in Uganda and also in Rwanda where maybe you set up constituencies and say these ones only women can compete in the primaries. Maybe that’s one way to do that. Now, that may raise some constitutional issues that we can resolve. Uganda’s done it and Rwanda has done it. That may be the only way to do it. But because it’s going down and down each time for factors that, you know, are hard to explain.

But it is difficult. You know, here, in the Senate, how many women do you have? About 15, 20 maybe, in the U.S. Senate? Anyone know? A small percentage. In the House, out of 435, you have about maybe a hundred, 25 percent.

So this global attitude towards women, I think that poor perception, we need to change it if the women are really going to really fully participate, even at global level. I know—I understand they’re now talking about a possible woman secretary-general this coming one. I’m sure this week there will be a lot of discussions on that. It’s very exciting. If that happens, it will be a real model for the rest of the world.

You know, so we are doing those things, little by little. And we hope we can succeed. But groups like yours, women in banking, they’re so important to empower women economically because if they are empowered economically, then I think they’ll be able to succeed politically and so on, and will be independent when their husbands or their fathers or their brothers or cousins. And so we are doing that.

KRAMER: So the Council has a policy of ending on time, but we got a little bit of a late start thanks to the traffic.

MUTHARIKA: This gentleman here has been trying so much, in the—in the blue shirt. Maybe he would—

KRAMER: All right. So the president—if the president’s willing to stay a few more minutes—

MUTHARIKA: That’s OK, yeah. Yeah.

KRAMER: —I’ve been told we can extend a little bit.

MUTHARIKA: What, another five, 10 minutes?

KRAMER: So you’re calling on—

MUTHARIKA: This gentleman in the blue—

KRAMER: All right.

MUTHARIKA: —has been trying very hard the whole morning. (Laughter, laughs.)

Q: Thank you, Mr. President. My name’s Earl Carr, representing Momentum Advisors. And I’m very proud to say my sister lives in Malawi and she teaches.

MUTHARIKA: Oh.

Q: And she’s been there for the last seven years teaching in the villages there as an educator.

MUTHARIKA: Oh.

Q: My question relates to the following. The role of Chinese investment in Africa has been quite controversial. What is your view and perception of the role of Chinese investment in Malawi to develop the economy? And how would you describe the role of Chinese investment? How would you describe the perception of the ordinary—of ordinary citizens in Malawi? How do they perceive the perception of Chinese investment?

MUTHARIKA: Yeah. No, I think for ordinary citizens it’s quite positive. The Chinese are mostly involved in infrastructure. That’s all they are doing—buildings, roads, and those kinds of things. They are not involved in things that directly touch people. So not in direct contact with the people. The Western countries tend to invest in more social services—education, health, agriculture—and maybe have more contact with the people. So they complement each other, and we are very happy with this kind of arrangement.

I was recently a guest at the World Economic Forum in Dalian about three weeks ago, and had the chance to talk to both my Western friends and also Chinese friends. I think there is a feeling that, you know, they are not mutually exclusive. They are complementing each other because they’re mostly infrastructure. So in terms of perception, in Malawi at least, I don’t think there is any negative attitude.

Now, where is your sister working? Where in Malawi is she working?

Q: (Off mic.)

MUTHARIKA: (Lilongwe ?), OK. Wonderful.

OK.

KRAMER: OK, I’m told we can take one more question. Did you want to call on someone else, Mr. President? (Laughs.)

MUTHARIKA: No, no. For some reason I had a thing that he’s connected with Malawi, I don’t know why. (Laughter.)

KRAMER: What?

MUTHARIKA: It was just an instinct there.

KRAMER: All right.

Thank you.

Q: Jeff Laurenti.

I wonder, Mr. President, if you could give us a little more clarity on your thinking on the utility of these big United Nations exercises in setting development goals. You described the Millennium Development Goals as a bit unrealistic, like cutting poverty by half or whatever, and the Sustainable Development Goals now being proposed for ratification this coming week as more realistic—that calls for eliminating poverty in 15 years. To what extent did you find—did Malawians find over the past 15 years that international assistance donors actually coordinated their assistance based on those Millennium Development Goals? To what extent, now that you’ve lost the bilateral donors, have the multilateral donors, A, filled in the gap; and, B, followed those goals? To what extent do you see even your national ministries implementing them? So is all this just a giant wind machine in New York? How do you see it translating into people’s lives on the ground?

MUTHARIKA: Yeah. First of all, let me clarify. On the donors, the multilateral ones also left. Only African Development Bank came back.

Now, to answer your question, I think it is an extremely important question as to why do you have these kinds of goals. But you know, I think it’s important to have these goals, these objectives, because then you can try to move towards them, so just like, you know, issues of human rights and so forth. I think they’re important. But you’re right.

You see, some of the donors, I think especially in the social areas—AIDS, population, and so forth—I think—and food security—I think they have worked honestly and tried to work together with domestic, with local institutions, local organizations.

For example, AIDS. Malawi is one of the best success story. I’ll be chairing a panel, I think, tomorrow because Malawi has done extremely well in the three—in the goals. For example, what they call plan B, option B, which is mother-to-baby transmission, it’s almost eliminated in Malawi, one of the leading countries. And that has been done because international organizations, both governmental and private, have been active with us.

In the economic area, I think this is where the problem really is because, in the end, it will be a question of resources. And what realistic, that we have a situation where the Western countries themselves are facing difficulties, internal difficulties, they can only give that much. So this is where the difficulty will be, how to achieve this. But I think the objective is a good one, but less of these goals. Fifteen years—let’s see where we are in 15 years.

I think, with respect to AIDS, I’m really convinced that in 15 years I think AIDS will be over. It’ll be the way leprosy was before or smallpox or whatever. It’ll be eliminated, I think.

But the other areas—infant mortality and others, complete elimination of hunger, of poverty—those will be harder to achieve because they involve a massive infusion of resources which, at the moment, the global community will not be prepared to have. So we’ll see what happens. But I’m excited about it. We’ll see. The intention is a good one.

The important thing, I think, was the fact that the international community, beginning with MDGs, for the first time—you know, before that the U.N. was just talking. It was mostly peace and security and the relations and the veto and so forth. The U.N. now moved into socioeconomic areas since the beginning of the MDGs. And that, in itself, I think was important. And I think, in the long run, it will probably be a positive thing. But I agree with you that it is going to be quite a challenge along the way. It will, yeah.

Thank you very much. Wonderful question.

Well, thank you very much.

KRAMER: Well, thank you. We appreciate you being here and answering our questions, and for being on the record.

MUTHARIKA: Thank you. Thank you very much. Thank you. (Applause.)

(END)

This is an uncorrected transcript.

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