Malawi fuel prices go up: Kapito says tough times ahead for consumers

Malawi Energy Regulatory Authority (MERA) has again hiked fuel pump prices effective Tuesday 12th November, 2013 citing continued depreciation of the Malawi currency against the United States dollar as a main factor for the adjustment.

A statement released by the country’s energy regulatory body  on Monday, Petrol has been hiked from K737.60 to K760.00 per litre while Diesel has moved from K730.90 to K770.20.

MERA – for the fourth time -has not adjusted price of paraffin for domestic use which is used for lighting by majority of poor rural Malawians and for domestic use.

Consumers Association of Malawi (Cama) warned Malawians to brace for more tough times ahead.

Kapito: Says consumers should brace for tougher times ahead as it expects prices of basic commodities to increase

Cama Executive Director, John Kapito, in reaction to the fuel price increase, challenged government and Reserve Bank of Malawi (RBM) governor to come out in open and admit the country’s economic policies were failing to achieve intended targets.

Kapito blamed President Joyce Banda and her followers for rushing into celebration that her economic policies were successful.

“People need to start asking these politicians who held celebrations over things that are temporary. Now with fuel prices going up, what does that tell you?” Kapito said.

He added: “We have not seen enough yet. There will be a lot of movements in fuel prices since we don’t have full control. The cost of living will become unbearable, and Malawians should brace up for worse moments ahead”.

In response to Kapito’s sentiments, Reserve Bank governor Charles Chuka claimed the central bank had sufficient forex reserves and has a target of two months import cover, about $366 million (K128 billion), by end of this year.

“I have enough muscle at the moment to make sure that no one tries me with the kwacha. I do need to ensure that the kwacha stabilizes throughout this period [lean period] and all the way to next year so that fuel prices don’t keep on rising,” he said.

The development comes a week after western donors, including the IMF and World Bank under the Common Approach to Budget Support (CABS) said on Thursday that they are withholding direct budgetary support until investigations on the looting and plundering at Capital Hill are concluded.

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