Alarm over delay in swearing in new Malawi leader LILONGWE (Reuters) - Malawian President Bingu wa Mutharika has died of a heart attack, medical and government sources said on Friday, and Washington expressed alarm at an apparent delay in swearing in his vice president as successor. Few of Mutharika's countrymen mourned a leader widely seen as an autocrat responsible for a stunning economic collapse. The constitution is clear that Vice President Joyce Banda should take over as head of state, although a smooth transition has not been assured since Banda was booted out of Mutharika's ruling DPP party in 2010 after an argument about succession. Mutharika appeared to have been grooming his brother Peter, the foreign minister, as his de facto successor. Malawi's constitution lays out a clear path for succession and we expect it to be observed. We are concerned about the delay in the transfer of power," the U.S. State Department said in a statement. We trust that the vice president who is next in line will be sworn in shortly. At a news conference late on Friday, Banda, a women's rights activist, refused to say whether she had become southern Africa's first female head of state. She has however met diplomats and military chiefs, signaling she intends to take charge. The 78-year-old Mutharika was rushed to hospital in Lilongwe on Thursday after collapsing, and was dead on arrival, the medical and government sources said. His body was flown to South Africa because an energy crisis in the nation of 13 million was so severe the Lilongwe state hospital would have been unable to conduct a proper autopsy or even keep his body refrigerated, the sources said. There was no immediate official confirmation of his death. State media said he had been flown to South Africa for treatment. Many Malawians blame Mutharika personally for the economic woes, which stem ultimately from a diplomatic spat with former colonial power Britain a year ago. "We know he is dead and unfortunately he died at a local, poor hospital which he never cared about - no drugs, no power," said Chimwemwe Phiri, a Lilongwe businessman waiting in a snaking line of cars for fuel at a petrol station. As reports of the death of the self-styled "economist in chief" swept the capital on Thursday, there were pockets of drunken jubilation among those who accused Mutharika of turning back the clock on 18 years of democracy in the "Warm Heart of Africa." "I am yet to see anyone shedding a tear for Bingu," said Martin Mlenga, another businessman. We all wished him dead, sorry to say that. Police deployed in force across the capital immediately after Mutharika's hospital admission, although it was business as usual on Friday as residents went about their daily struggle to get by. Mutharika came to power in 2004 and presided over a 7-year boom - underpinned by foreign aid and favorable rains - that made Malawi one of the world's fastest-growing economies. The good times ended last year after a spat with Britain, Malawi's biggest donor, that led to tit-for-tat diplomatic expulsions and the freezing of millions of dollars of aid. The cause of the row was a leaked diplomatic cable that labeled Mutharika "autocratic and intolerant of criticism." The aid freeze exacerbated an already acute dollar shortage, hampering imports of fuel, food and medicines, and leading to a slide in the value of the kwacha against the dollar. The diplomatic isolation and economic plight worsened in July 2011 when the United States shelved a $350 million overhaul of the dilapidated power grid after police killed 20 people in a crackdown on an unprecedented wave of anti-government protests. Additional reporting by Pascal Fletcher; Writing by Ed Cropley; Editing by Pascal Fletcher