MALAWI'S ANTI-CORRUPTION FIGHT RATCHETS UP

UNCLAS SECTION 01 OF 02 LILONGWE 000131

SIPDIS

STATE FOR AF/S ADRIENNE GALANEK
STATE FOR EB/IFD/OMA FRANCES CHISHOLM
STATE FOR EB/IFD/ODF LINDA SPECHT
TREASURY FOR INTERNATIONAL AFFAIRS/AFRICA/LUKAS KOHLER
JOHANNESBURG FOR FCS

E.O. 12958: N/A
TAGS: EAID EINV KCOR PGOV KMCA MI
SUBJECT: MALAWI'S ANTI-CORRUPTION FIGHT RATCHETS UP

REF: A. 2004 LILONGWE 1018

B. LILONGWE 117

This message is sensitive but unclassified--not for Internt
distribution.

--------------
SUMMARY
--------------


1. (U) Malawi's president used Malawi's Anti-Corruption Day
on February 5 as a platform to reaffirm his stance against
corruption and to use the issue as a political lever against
the ruling party. As he raises the profile of this issue
still further, the main GOM agency responsible for
prosecuting and preventing corruption is hampered by lack of
funds. This presents a potential new liability for
Mutharika, as failure to produce tangible results, mainly in
the form of convictions, would cost him significant political
credibility. End summary.


-------------- --------------
POUNDING THE PODIUM AGAIN, THIS TIME WITH FEELING
-------------- --------------



2. (U) At the ceremonies marking Malawi's Anti-Corruption Day
on February 5, President Bingu wa Mutharika reaffirmed his
government's commitment to controlling corruption. By
itself, his presence at the event would have had that effect,
but he also delivered a speech characterizing the fight
against corruption as "the centerpiece of our Government's
management policy." Promising "not (to) relent until those
who plundered our economy with impunity have been brought to
book," Mutharika bemoaned both Malawi's reputation as "one of
the most corrupt countries in Africa" and the cost of
corruption in terms of international development assistance.


3. (U) Casting corruption as a phenomenon of the past ten
years, Mutharika took another step toward identifying it with
the administration of former president Bakili Muluzi. He
went so far as to describe the "disgust" of Malawians "that a
person can acquire more than forty houses...within a short
period of ten years," a clear reference to Muluzi. As
previously reported (ref B),Mutharika resigned from Muluzi's
United Democratic Front party at the end of his speech, on
the grounds that he can no longer associate himself with such
a corrupt political cohort.


--------------
MULUZI'S HEAD? PERHAPS NOT YET
--------------


4. (SBU) In the week after this dramatic move, speculation is
running high that Muluzi will be arrested soon, driven in
part by Mutharika's mention of the "individual" with forty
houses. Sources within the GOM have indicated that Muluzi
has been under some level of investigation since at least
September. However, in our frequent encounters with senior
GOM officials with a stake in the issue, there is a marked
absence of bloodlust toward the former president. While the
sense of outrage does have a political dimension, it seems to
be directed more toward the corrupt practices themselves than
at Muluzi. This may be a question of proximity: as Muluzi's
power continues to fade, his personal culpability, and the
possibility of his prosecution, may enter more into the
public discourse. (NOTE: A couple of recent developments
point to action against Muluzi sooner rather than later. The
former president's guard supervisors were changed two days
ago, causing a political flap, and GOM contacts have said
that the case against Muluzi is ready to go, and arrest is
imminent. However, this is not the first time we have heard
that arrest is imminent. End note.)


--------------
CAPABLE HANDS, BUT FEW TOOLS TO WORK WITH
--------------


5. (U) In any event, the pressure is now on the ACB to
deliver, and its first priority is convictions for high-level
corruption. While the ACB's relatively new director appears
to be doing his best to get good cases to court, it is
doubtful that he has adequate resources to do so. In his
speech at the Anti-Corruption Day observances, Kaliwo pleaded
with the President to give him more and better tools. These
included legal changes such as powers of search and arrest,
but also mundane needs such as better salaries, money for a
hotline, vehicles for investigators, and a roof that does not
leak.

6. (SBU) NOTE: In a meeting on February 8 to discuss
administration of an impending $200,000 ESF grant, Kaliwo
said he has only one full-time prosecutor and a staff of
well-educated but untrained investigators. The UK is
providing funds for the ACB to contract some prosecutors from
private practice, but his organization is clearly struggling
to keep up, even with the relatively tight focus Kaliwo has
brought to the organization (ref A). End Note.


7. (U) As of now, the ACB has delivered only one conviction
during Mutharika's time, on a case that was brought by the
last administration. The Bureau's highest-profile case, that
of former finance minister Friday Jumbe (ref A),is stalled,
and the ACB is just now getting some (donor-funded) outside
help. Several other cases are making their way toward trial
dates, but it is unclear whether the ACB can assure the
high-profile convictions they need.


--------------
COMMENT
--------------


8. (SBU) Mutharika continues to raise the stakes on
delivering some tangible results in his anti-corruption
drive. With his resignation from the UDF, he has managed to
elevate the problem to the political level. In essence, he is
building a public enemy of the Muluzi coterie's entrenched
interests. This is proving to be politically useful, as it
forces his UDF compatriots to choose sides, and casts the
choice as a moral one.


9. (SBU) To keep his credibility on this issue, though,
Mutharika must show that he can punish the most egregious
cases. Few doubt his sincerity at this point, but sincerity
is not enough to solve the problem. As his ACB director
reminded him very publicly, he needs to commit more resources
to prosecuting past cases and preventing future ones. Now
that the stakes are higher, the success of a few good cases
would likely buy the GOM some time and credibility. The
failure of those same cases could be a significant political
failure, erasing the moral advantage that Mutharika now
enjoys, mostly on credit.


GILMOUR