The opposition Democratic Progressive Party (DPP) has faulted government for introducing a new K5,000 bank note saying that it is a symbol of an ailing economy.
DPP spokesperson on Finance in Parliament Joseph Mwanamvekha said despite that the move was earlier proposed by the DPP administration, it was later withdrawn after analysing the impact of introducing the high denomination.
“It is a worry of Malawians and indeed me as spokesperson for DPP, I am saying this because if you look around countries with higher denominations are countries that have either economic crisis or their economies are not performing very well,” he said.
“Of course looked at it, but then when we analysed the impact of it, we looked at the countries that have higher notes we found out that we are not in a similar situation so we thought at that point that it is not good for Malawians, not good for economy and also the currency itself that’s we stopped it but that discussion indeed took place.”
But Minister of Finance Felix Mlusu has defended the introduction of the note amid divided opinion from Malawians.
Mlusu has argued that the introduction of the note is a significant step towards consolidating cost of printing and quantity of new notes.
“I talked about the issue of cost of printing new notes because right now the notes that we are carrying, we are now having to carry quite a lot of notes just to do a small transaction, so wanted to consolidate the carrying of the notes at least to much smaller quantities but of high value,” he said.
“The introduction of this note does not mean that it is fueling inflation, inflation has totally different factors that affect it, inflation are issues to do with demand and supply but here we are just trying to reduce the cost of printing notes.”
According to the Reserve Bank of Malawi (RBM), the new K5, 000 note is expected to go into circulation on February 24, 2022.