President Lazarus Chakwera has disclosed that the leader of the United Arab Emirates has invited him to Abu Dhabi for discussions related to fuel and other long-term needs of Malawians.
“I have accepted an invitation from the President of the United Arab Emirates to visit him in Abu Dhabi next week,” stated Chakwera stressing that all expenses for the trip to Abu Dhabi will be covered by the UAE government.
The President made the disclosure about the trip during his Special Address to the Nation at Kamuzu Palace in Lilongwe on Wednesday evening.
He stated that to address issues of fuel scarcity, his administration is transitioning Malawi from the Open Tender System for fuel procurement to a Government-to-Government arrangement aiming at ensuring more secure access to fuel through improved payment terms and cycles.
Chakwera acknowledged that the country is currently experiencing disruptions in fuel supply due to insufficient generation of foreign exchange required to meet fuel demand stating that this shortfall has created challenges for the two main fuel importers, the National Oil Company of Malawi (NOCMA) and Petroleum Importers Limited (PIL).
He disclosed that Malawi’s monthly fuel demand is approximately $50 million adding that fuel importers have struggled to acquire enough foreign exchange from the market to import sufficient fuel volumes and that as a result, NOCMA has accumulated a debt of $72 million to suppliers as of October 2024.
“In the month of August, NOCMA only raised 23 million dollars of the required forex, while in September and October, that number fell below 20 million dollars, increasing NOCMA’s debt to suppliers to 72 million dollars in October and resulting in a 10-day suspension in NOCMA’s access to fuel imports,” the President stated.
Chakwera said the ongoing forex shortage due to growing fuel demand, has hampered the country’s ability to maintain a steady fuel supply as evidenced by the 10-day suspension that created the fuel queues over the past six weeks, “forcing many of you to suffer long days and nights at fuel stations, as well as disruptions to your lives, work, and businesses.”
He indicated that due to this development, he instructed the Treasury to reach out to their partners at the Arab Bank for Economic Development in Africa (BADEA), who responded by offering a $50 million revolving credit facility and the Reserve Bank to accelerate efforts to secure more foreign exchange through commercial banks.
“These measures have allowed NOCMA and PIL to provide fuel at filling stations, and tonight I must thank you for your patience during the six weeks we have been having meetings in the night to resolve the fuel shortage,” said President Chakwera.
The President emphasised that it was therefore imperative for the country to adopt a new and alternative approach for importing fuel into Malawi as opposed to the Open Tender System for accessing forex that NOCMA and PIL had been relying on and had resulted in fuel supply disruptions at different times in the past 20 years.
The post Chakwera restructures fuel buying system…condemns political thuggery, terrorism appeared first on Malawi Voice.
