An official from an economic think tank has said the government decision to hike fuel prices would trigger goods and services hike which will negatively affect the economy.
The Malawi Energy Regulatory Authority (Mera) announced in a statement released on Friday night that it had increased the pump price of petrol by 5.01 percent and diesel by 5.02 percent to reflect the rise in fuel prices on the international market.
Economic Empowerment Action Group (Eeag) president Lewis Chiwalo said the economy is not doing well and the decision to hike the fuel prices would just negatively affect the ailing economy.
“On paper, the economy might be doing well but on the ground things are different. The fuel price hike does not match the current economic trends,” he said.
He said the fuel hikes are not sustainable to the economy.
“The economy is not in good shape, the government should not have increased the fuel prices this time because fuel is the lifeline of the economy, this has been bad timing,” he said.
He said the markets will respond harshly by pushing the costs to the consumers through goods and services hikes at the time when Malawians have no money in their pockets to spend.
Chiwalo said the fule hike threaten to prevent inflation slowing.
He said inflationary pressures were easing but will start picking up.
Meanwhilem the pump price of petrol is now at K932.50 from K888.00 while diesel is selling at K935.60 from K890.90 and paraffin is being sold at K755.30 from K719.30.