Mutharika shields the poor in fuel hike: Malawi govt provides 50% subsidy

Government is paying half of the total amount which Malawians would have been paying on fuel price increase .

Motorists affected have been cushioned by government subsidy of the prices

This government subsidy will ensure that the price increases that would be passed to the consumers for other goods and services are minimal as economic experts are warning of tough economic times ahead.

Malawi Energy Regulatory Authority (Mera), in a statement, says fuel is now sold at K888 per litre from K824.70 while diesel is now sold at K890.99 from K815 and paraffin is now sold at K790 from K648.10.

The regulator said the adjustments are due to the escalating fuel prices on the world market.

Renowned economist Ben Kalua said the fuel hikes are justified, saying the fuel prices on the world market have been escalating but in Malawi, the fuel price stabilisation fund cushioned the prices.

He however asked the government to reduce imports affected by fuel increases to avoid escalating high cost of living.

“The fuel prices will affect all sectors because Malawi is a landlocked country and depends on fuel for the transportation of its goods and services,” he said.

Kalua also said that due to erratic supply of electricity, most institutions use fuel for power generation of their gen sets.

“This will have an impact on production costs, consumers will be affected by the production costs as a result, the government will not be able to collect much taxes as was the case before,” he said.

Fuel prices were last increased significantly two years ago in Malawi.

However to protect Malawians from bearing a 100 percent of the increase, government is providing a subsidy, paying half of the increment rate.

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Johane
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Johane

This is a very poor article. The money being used to cushion the price hike is coming from the Price Stabilisation Fund (PSF) – and the PSF got its money from levies on ordinary people themselves! So to say that its somehow the government or Peter helping people is false and misleading. In fact we don’t even know how much money is in the PSF. Chances are some of it has gone directly into Peter’s account.

Cashgate1
Guest

APM will not shield the poor, case of Police Scandal, ESCOM Genset deals, Escom bulb deal etc. This Nyasa reporter should get it right that its government, in fact our taxes that are being used for subsidy that is being said. By the way where is fuel levy funds? Hope they are not funding this party called DPP.

concerned citizen
Guest
concerned citizen

Show the figures. Like, the new price would have been so much minus 5o % subsidy. Koma apa mwangoonetsa mtengo watsopano wa mafuta without showing the 50% subsidy government is providing. The question is, were the fuel prices going to be double the new rates you have shown here?

kanchenga
Guest
kanchenga

Indeed my friend. They should tell us where the subsidy money is coming from. Otherwise social services will be affected even further and the poor man will be punished even more while the rich can pay for private schools clinics and buy the subsidized fuel into their car. The poor man will be at the mercy of a cruel minibus operator. It is the rich that have been protected not the poor.

Kibaki
Guest
Kibaki

Who are you fooling?

Cognitive Dissonance Theory
Guest
Cognitive Dissonance Theory

Read the Head line and see how the Nyasatimes reporter is trying hard to make someone look good and then see the last part of the statement. Who is providing the subsidy? The truth of the matter is that fuel has gone up, things will go up, the salary increment people will get at the end of this month will be eaten away but the increase of commodities on the market, even a Landlord akuti mafuta akwela.

Pension Nenereko
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Pension Nenereko

Where is the price stabilizing Fund? Inabedwatu imeneyo!!!

Gome
Guest
Gome

i am failing to see or find where the shielding is?

getrude
Guest
getrude

Kamuzu style. thanks my president. we appreciate

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