‘We want transparency on fuel pricing’

Civil society organisations under the banner of the Human Rights Defenders Coalition (HRDC) last Friday met the Ministry of Energy and Mining to discuss fuel pricing concerns. This comes amid rising fuel prices linked to the conflict in the Middle East. EDWIN NYIRONGO spoke to HRDC chairperson MICHAEL KAIYATSA.

Excerpts: meeting focused on concerns over recent fuel price adjustments and the broader pricing framework in Malawi. We raised issues of transparency, predictability and accountability in how fuel prices are determined. We also sought clarity on the application of taxes, levies, margins and the price stabilisation mechanism, given the direct impact of fuel costs on transport, the cost of living and the wider economy.

The Ministry and the Malawi Energy Regulatory Authority (Mera) gave a detailed presentation on the fuel price build-up and factors behind the latest adjustment. They explained the composition of the price, including taxes and levies, how margins are determined and how the stabilisation fund is applied. We appreciate the engagement, but explanation alone is not enough.

[paywall]

While the technical breakdown was useful, it does not fully address deeper concerns around transparency, fairness and accountability. Citizens are not only interested in how prices are calculated, but whether the structure itself is fair, whether current taxes and levies are justified and whether the stabilisation mechanism is effectively cushioning them from price shocks. There is also no clear indication of how government intends to reduce the burden on citizens, especially as fuel price i n c r e a s e s drive up transport costs, food prices and inflation.

So, while the engagement was constructive, key policy concerns remain unresolved. Yes, at a technical level. Engagement with Mera and the ministry has been constructive.

However, acknowledgment is not enough. What is needed now are concrete policy measures to protect citizens from fuel price shocks and rising living costs. The real test will be whether these discussions lead to tangible improvements and consistent cushioning against global volatility.

Given global price increases due to the conflict in Iran, are the adjustments not justified? Global events do influence fuel prices, and that cannot be disputed. However, the key issue is how the domestic s y s t e m responds to such shocks.

Go v e r nme n t must have flexible fiscal tools to cushion citizens during periods of volatility. This could include temporary adjustments or suspension of selected taxes and levies that significantly contribute to pump prices. Countries such as Zambia, Namibia and Ghana have implemented such relief measures to reduce the immediate burden on consumers.

Government says it is using an automatic pricing system. What is your view? The discussion should not be reduced to political comparisons.

Malawians elected the current government to address economic challenges, including rising living costs. The focus should therefore be on delivering solutions rather than revisiting past decisions. You have called for Government-to-Government (G2G) procurement.

In December 2024, Parliament passed the Liquid Fuels and Gas (Production and Supply) (Amendment) Act, enabling a shift from open tender to G2G procurement. The reform aimed to reduce import costs through direct purchases from producers, particularly in the Middle East. At the time, it was reported that the arrangement could save about $100 per metric tonne compared to the previous system. We believe such cost efficiencies should translate into lower or more stable pump prices.

[/paywall]