Malawi ponders another fuel price hike

Just after a month when Malawi Energy Regulatory Authority (Mera) increased pump price of fuel by an average of 30 percent government is piling pressure on the regulator to implement another increase before Christmas.

Sources in government have confirmed that another fuel hike is imminent in the country as Malawi is struggling to pay $45 million facility.

Officially, government says there is no impending fuel hike.

Nyasa Times sources say the new price will be: Petrol = K460 per ltre, Diesel = K415 per litre, Parrafin = K310 per litre.

Queue for fuel: Prices to go up

Poor Malawi can’t access another facility to import fuel until it pays the outstanding loan to PTA Bank and the sources say if nothing is done to correct the situation Malawi fuel pumps will be completely dry in 7 days and the situation will be few cars plying on the roads from January1 2012..

Dwindling earnings from tobacco – the country’s mainstay, an aid freeze, has resulted into Malawi failing to meet it’s rising fuel import bill. In two years the annual import bill has doubled from around $180 million to $350 million.

Court battle

Already government is in a court battle after some citizens noted that the fuel price increase in November was illegal since Mera didn’t have a sitting board to implement the decision as required by law.

Lawyer Wapona Kita said under Section 9(c) of the Energy Regulation Act, only the board of MERA has the powers to approve prices of energy sales and with no Board in place MERA whoever has approved the previous hike acted beyond his or her powers rendering the increase illegal.

A concerned citizen Khalidwe Chilivumbo, a resident of Area 18 in Lilongwe who owns a motor vehicle and thus he has been directly affected by the decision of MERA management,  had asked the Lilongwe High Court to declare the fuel price increase illegal.

But Minister of Energy Goodall Gondwe says:  “We must do thigs that appears to be right for the common good of Malawi not that appear to be good for a lawyer.“Are we going to wait for the board to be appointed to solve a crisis.”

Ministers are facing tough time to make decisions on the matter with the previous action to increase fuel in court and the President is the one calling shot on the matter.

Following the adjustments November, petrol in Malawi is selling at $2.3 per litre, up from $1.8, and diesel at $2.1, up from $1.6 per litre.

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