Malawi President Moves to Ease Fuel Crisis

Malawi’s president has ordered the Reserve Bank of Malawi to prioritize buying fuel in any foreign currency the country can secure to deal with a fuel shortage. The shortage has forced Malawi’s drivers to wait hours in line, or to buy fuel smuggled in from neighboring Mozambique.

The scarcity of fuel in Malawi is largely attributed to a shortage of foreign exchange, especially U.S. dollars.

The shortage has forced Malawi’s drivers to wait hours in line, sometimes overnight, or to purchase fuel illegally smuggled in from Mozambique.

The problem is more rampant in central and northern Malawi where many pump stations have run dry for weeks.

Clement Chinoko is a journalist working for the daily Nation newspaper in the capital Lilongwe, where fuel remains in short supply. “It has been a hustle. The last time I fueled I had to wait for about three hours in Lilongwe City Centre. This is the main business area of the capital city. That was three days ago. Today, I am back on the queue as well, hoping that I am going to be serviced.”

Another motorist Matilda Chibambo from Blantyre, says she had to abandon her car on her way to northern Malawi.

“I was supposed to be in the meeting in Mzuzu yesterday, that is Wednesday, but until now I am in Salima, I am stuck because there is no fuel. I am trying to board a public bus but I have also noted that the bus fare has increased. So, the situation is so, so frustrating and I am so angry right now.”

Malawi President Lazarus Chakwera said Wednesday the government is taking steps to improve the fuel supply.

“I know that the current shortage of fuel is adversely affecting manufacturing, businesses, work, and domestic life, and I want to assure you that we are seized of this matter to ensure that there is product in the service stations in the short term, while we work on the long-term forex issues that are at the root of this problem.”

Malawi obtains most of its foreign exchange earnings from tobacco. However, statistics from the Auction Holding Limited show that this year tobacco crop raked in $182 million, compared to $197 million last year, a decrease of 7.7 percent.

Fuel company Petroleum Importers Limited told reporters this week that it is struggling to bring in fuel because it lacks the $22 million in foreign currency required each month.

President Chakwera said the government is working with banks to acquire the needed funds.

“So, as we speak, we have therefore already secured $28 million dollars from local banks for this purpose, and we are in pursuit of another $50 million dollar facility for the same, on top of instructions the Reserve Bank has received to prioritize fuel procurement in the allocation of any forex we secure.”

The president said imports have resumed and the country is tapping its reserves.

“So, as we speak, we have over 6 million liters being brought into the country, while at the same time we have doubled the daily distribution of the product we already have in our reserves to ease the burden.”

Motorists like Chikono and Chibambo hope the government can find a long-term solution, like increasing the export base to curb the shortage of foreign exchange.

Source: Voice of America