The Centre for Democracy and Economic Development Initiatives (CDEDI) says fuel prices, under normal circumstances, should be pegged at around K4,500 per litre, arguing that the current high pump prices are being driven by cartels
Speaking during a press briefing in Blantyre on Thursday, CDEDI Executive Director Sylvester Namiwa said alleged cartels in the fuel supply chain, foreign exchange management and public procurement are distorting the economy and weakening the Kwacha, thereby reducing people’s purchasing power.
Namiwa claimed that the National Oil Company of Malawi (NOCMA) has drifted from its original mandate of managing strategic fuel reserves and is now operating in ways that do not serve public interest.
“NOCMA is no longer serving its core mandate. It has become part of a system that is draining resources from ordinary Malawians instead of protecting them,” Namiwa said.
He accused the company of awarding most fuel haulage contracts to foreign transporters and relying on foreign insurance firms, a practice he said increases demand for scarce foreign currency while sidelining local transporters.
According to CDEDI, NOCMA is also sourcing fuel through middlemen from Tanzania, resulting in inflated import costs that are passed on to consumers through high pump prices.
“The fuel import chain has been captured by intermediaries who are making abnormal profits at the expense of the public,” he added.
The organisation questioned how NOCMA handles its finances, noting that it is funded through the Strategic Fuel Reserve levy paid by motorists and consumers.
CDEDI further argued that Malawi should adopt cheaper and more efficient fuel transportation systems such as rail and pipelines, and consider investing in Angola’s Lobito Oil Refinery project to reduce fuel import costs.
The group also called for long-term reforms in the energy sector, including exploring the possibility of establishing a local refinery to improve energy security and reduce dependence on imports.
On fuel pricing, CDEDI insisted that the K350 per litre under-recovery levy under the Automatic Pricing Mechanism should be scrapped immediately, arguing that it is unfairly burdening consumers despite claims of outstanding debts between fuel importers, NOCMA and the Malawi Energy Regulatory Authority (MERA).
“Ordinary Malawians should not be made to carry the burden of administrative failures and unresolved debts between institutions,” Namiwa said.
The organisation urged authorities to urgently resolve the dispute and remove the levy to ease pressure on consumers.
CDEDI maintained that without decisive reforms in the fuel sector, the cost of living will continue to rise, warning that Malawians cannot afford another five years of economic strain.
“Malawians are not ready for another wasted five years, and fuel prices must fall,” Namiwa said.
