Mera’s K950 billion debt to oil importers raises alarm – IMF confirms PSF is empty

The Malawi Energy Regulatory Authority (MERA) is facing a massive debt crisis, owing over K950 billion to Petroleum Importers Limited (PIL) and the State-owned National Oil Company of Malawi (NOCMA).

According to the International Monetary Fund (IMF), the debt stems from accumulated import losses that should be covered by the Price Stabilisation Fund (PSF).

The PSF, which was designed to cushion consumers from volatile global fuel prices, is now reportedly depleted, leaving no funds to meet these obligations.

This financial shortfall poses serious risks to Malawi’s fuel supply chain, as importers may struggle to secure fresh consignments without payment assurances.

Energy sector analysts warn that if the debt remains unsettled, the country could face prolonged fuel shortages and increased pump prices.

The IMF’s confirmation of the debt highlights the severity of the fiscal strain on Malawi’s energy sector and raises concerns about the management of the PSF.

Industry insiders say urgent measures are needed to restore the fund’s capacity and clear arrears to safeguard national energy security.

The development also highlights Malawi’s broader economic challenges, as high debt levels and foreign exchange shortages continue to constrain government operations.