Chairperson of the Parliamentary Committee on Agriculture, Sameer Suleman, says their assessment of sugar prices has shown that sugar is cheaper in Malawi than in neighboring countries such as Mozambique, Zambia, and Tanzania.
However, I have contrary views on this issue. The truth of the matter is that according to my findings on June 26, 2023, Zambian sugar was selling at the same price as it was in Malawi at the time.
The claim made by Suleman during a trade visit at the Mchinji border on Saturday is incorrect.
Speaking with reporters, Suleman said that the issue of rising sugar prices is determined by the foreign currency exchange rate and it is not true that the K1,500 per kilogram price of Malawian sugar is higher than the price from neighboring countries.
He added that 90 percent of Malawian sugar is crossing the border, which shows that there is a high demand because sugar is more expensive in neighboring countries than Illovo sugar. Therefore, traders will go for a cheaper price.
According to my findings, Malawian sugar is crossing the Zambian border for different reasons. First, Lilongwe is much closer to Chipata than Lusaka, which makes Illovo sugar more readily available than Zambian sugar in Chipata because of distance.
Second, our neighbors prefer our sugar to theirs mainly because of distance and the fact that the order price is almost the same. Lusaka is about 700 kilometers from Chipata, while Lilongwe is closer. Therefore, distance is a determining factor in business.
The only thing the government can do is to make sure the value of our local currency is stable and maintain it. This will help to keep prices of commodities affordable.
The introduction of a 90-gram packet of sugar and plans to introduce a 200-gram packet of sugar are clear evidence that the price of sugar is not affordable in Malawi for various reasons, including devaluation, high prices of commodities (not only sugar), and low income.
On June 16, 2023, the Minister of Trade and Industry gave Illovo Sugar Limited seven days to reduce sugar prices, but the company has maintained the current price.
The Centre for Democracy and Economic Development Initiative (CDEDI) has been pushing Illovo Sugar Limited to reduce its prices and has vowed to continue with the fight until they see a change.
I think CDEDI should push the Tonse Alliance government to do something to stop the Malawi kwacha from falling, corruption, and overspending on unnecessary travel in order to maintain foreign exchange reserves from depleting. I think the fight must take a different direction from Illovo to the government until things change.
Malawi needs an economic recovery plan in order to decrease unemployment, increase consumer spending, raise incomes, increase gross domestic product (GDP), and improve business activities.
