Banks trim fuel importers’ foreign exchange allocations
Petroleum Importers Limited (PIL) general manager Martin Msimuko says the shortage of foreign exchange in the country has forced commercial banks to trim the dollar allocation to importers, leading to prevailing product stockouts.
Speaking when PIL alongside other players in the fuel sector appeared before the Joint Parliamentary Committees of Natural Resources and Climate Change, Statutory Corporations, Transport and Trade, Industry and Tourism he said they are struggling to import the commodity.
Msimuko said Standard Bank Malawi plc used to allocate $25 million to fuel importers, but has reduced the allocation to $5 million while FDH Bank plc has reduced its allocation from $10 million to $5 million.
He said only Ecobank Malawi Limited increased the allocation from $30 million to $40 million, but the amount has already been exhausted.
National Oil Company of Malawi (Nocma) deputy chief executive officer Helen Buluma shared Msimuko’s sentiments, saying forex shortage is crippling fuel importation.
She said: “The issue is not about money because Nocma has billions in kwacha terms to cover all required fuel imports. But we are struggling because we have no access foreign exchange [dollars].”
However, Buluma said Nocma went to Tanzania to negotiate with suppliers for 10 million litres of diesel and 10 million litres of petrol and that fuel will be supplied to Malawi soon.
On his part, Malawi Energy Re g u l a t o r y Authority (Mera) chief executive officer Henry Kachaje said there is a need for the country to double generation of forex despite the demand for imports going up.
He said: “For fuel alone, the country, needs $600 million a year but tobacco, which is the major forex earner for the country only brings in about $200 million.
“The country needs to have a conversation on how it can double the forex generation.”
Joint committee co-chairperson We l a n i Chilenga said they will engage the Reserve Bank of Malawi and call for a meeting for all stakeholders to ensure they find a solution as soon as possible.
