CAMA appeals to President, MERA and NOCMA to assure public when supply of fuel will stabilize
As long queues at filling stations keep resurfacing, Consumer Association of Malawi (CAMA) has asked President Lazarus Chakwera and management of Malawi Energy Regulatory Authority (MERA) and National Oil Company of Malawi (NOCMA) to assure and inform the public when supply of fuel will be stable across the country.
In a statement, CAMA Executive Director, John Kapito says the scarcity of fuel in the last two months has triggered high prices of various goods and services on the market.
Kapito maintains that cost of transportation of various goods and services has increased thereby creating scarcity of both local and imported commodities on the market.
“The President, MERA and NOCMA for the past two months assured consumers that scarcity of fuel will stabilize within a week,” he said. “Unfortunately, it is now over two months since such promises of fuel stability were made and we continue to experience fuel scarcities and long queues in the filling stations.
He also said the fuel scarcity has led to vendors buying in bulk and selling it back at exorbitant prices on the black market.
Some people are filling up fuel in jerrycans and selling back to motorists exorbitantly between K2,500 and K3,000 per litre, forcing MERA to issue a public notice last month discouraging the practice as this created panic amongst the public, who believe that there is serious fuel scarcity.
MERA also asked the public to get a clearance first if they want to buy in bulk, that has a fee of K10,000
However, Nyasa Times observed that the vendors were beating the system using motorbike taxis (Kabaza), who cut the queues, fill up full tank, drive off to siphon the fuel into jerrycans and come up to refuel.
These kabaza operators congest the pumps, leaving motorists waiting for far too long and thereby making the queues much longer than they could have been if the kabaza taxis were to queue behind motor vehicles on first come first serve.
Meanwhile, CAMA maintains that “Malawians are going through one of the highest cost of living and the failure to control the supply of a key commodity like fuel is an economic suicide for a poor country like Malawi”.
When announcing the reduction of pump prices of petrol at K1,746 per litre from K1,946 last month, MERA assured of stable supply of fuel but this is not what’s on the ground as filling stations keep running dry.
The reduction followed another decrease effected in August from K1,999 to K1,946 per litre.
In June, Petroleum Importers Limited (PIL) announced that it would be transporting its fuel products using cargo trains from the Mozambican port of Nacala.
The announcement was made on social media on ‘Chakwera Delivers’ Facebook page, that indicated that “for over 20 years, Malawi has been losing billions from the inland haulage of fuel through road tankers [and] today, we as a nation, are celebrating the resumption of fuel transportation by rail via the Nacala Corridor”.
Accompanied by pictures of a offloading exercises from rail tankers managed by Central East African Railways (CEAR), the announcement said about 500,000 litres of fuel were hauled into the country from Nacala Port in June.
The announcement lauded President Lazarus Chakwera “and his government for championing and revamping this important and cost-effective mode of transportation. Pa ground pakusintha ndipo pakuwala daily!”
But just a week later, MERA increased fuel pump prices with petrol up by 44.92% from K1,380 to K1,999 a litre; diesel by 30.61% at K1,920 from K1,470 and 29.29% for paraffin — at K1,236 from K956.
An impeccable inside source at MERA indicated that the benefits of the cost-effective rail fuel transportation would not be instant following the current economic pressures Malawi is facing and taken into account the 25% devaluation of the Malawi Kwacha and other strong global market forces.
But reports reaching us then were that NOCMA could have contributed to the astronomic fuel hike as it committed to be paying extra costs for fuel importation assigned to private transporter association — namely Women in Logistics and Large-Scale Suppliers.
A letter dated April 29, 2022 from former NOCMA deputy chief executive officer (CEO), Helen Buluma indicated that the government entity “nominated” the Women in Logistics and Large-Scale Suppliers to haul fuel from its supplier in Dar es Salaam, Camel Oil.
The letter said: “We refer to several discussions in meetings between October 2021 and April 22 with yourselves along with other Transporters Associations in the country.
“It was agreed, among other matters, that you will work with our Suppliers to transport Petroleum Products belonging to NOCMA on an interim basis whilst we jointly work towards finalizing the Tripartite Fuel Haulage Agreements with our suppliers in which NOCMA will be the facilitator and not a contracting party.”
The letter further asked Women in Logistics and Large-Scale Suppliers to nominate and provide 100 trucks for the month of May, 2022 to be “lifting petroleum products for Camel Oil as determined by the supplier’s loading instructions”.
The routes assigned were Dar es Salaam to Mzuzu at US$125/m3 and and Dar es Salaam to Lilongwe at US$135/m3.
Buluma informed the transport association that the supplier in Tanzania, Camel Oil, was offering the rates she quoted and made it known that “NOCMA is aware that these rates are lower than MERA’s prescribed Fuel Haulage Rates, which have just been revised upwards on the 10th of April, 2022”.
She thus made a declaration that NOCMA “commits to top up the difference between the two rates to be within the country’s Regulated Rates”.
“Kindly note that as part of our support towards efficient fuel haulage operations, NOCMA will offer your Association a Credit Facility for the purchase of diesel for the sole purpose of transporting NOCMA’s Petroleum Products during this Interim Haulage Arrangement.
“The Terms and Conditions governing the Credit Facility will be detailed in the Credit Sales Agreement to be signed between your association and NOCMA once all due diligence processes are finalised.”
When reached out for further clarification, Buluma, who has since been relieved of his job, referred this reporter to NOCMA spokesperson, Chisomo Mwamadi who responded that they would not comment on the issue.
Last week, Ombudsman Grace Malera directed that the appointment of Buluma should be treated as it never happened and no benefits should be paid for the time served.
The Ombudsman also directed that Buluma’s contract should be terminated forthwith and if any extension was done it must be nullified forthwith.
According to Ombudsman’s determination, Buluma should not be allowed to benefit from an illegality.
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