• September 26, 2022 7:08 pm

President Chakwera secures $50Mn fuel financing from BADEA

Sep 22, 2022

Malawi Leader President  Dr Lazarus Chakwera has secured a $50Million (About K50Bn) from the Arab Bank for Economic Development in Africa (BADEA) for the purchase and replenishment of strategic fuel reserves which were depleted following the scarcity of forex in the country.

For the past three weeks , Malawi has been having long fuel queues in various filling stations and some resorted buying the fuel from black markets which proved to be very expensive.

But confirming the good news, Minister of Finance Alfred Sosten Gwengwe said the money will help to ease fuel pressure.

“It’s true that the Board and Management of BADEA has approved this funding to Malawi Government. This money will help to finance the fuel purchase as you are aware this is what the President said before going to UNGA,” Said Gwengwe.

Recently NOCMA management met Parliament where the Deputy Chief Executive Officer Hellen Buruma said fuel pressure would ease following 300 tankers of fuel  which are on their way to Malawi.

National Oil Company of Malawi (NOCMA) says pressure on buying of fuel is expected to ease when the 300 tankers of fuel which are on their way into the country arrive.

NOCMA deputy Chief Executive Officer Hellen Buruma said the tankers have carried the volume in equivalent to 10.8 Million litres.

Buruma said the current problem borders on the issue of forex.

Buruma said she is hopeful that the10.8 Million litres of fuel from Tanzania Tanga Port  will help to stabilize the current fuel  shortage in the country.

*She said on 21 First they are waiting for good news from BADEA the amount which is $50 Million.*

She said: “If BADEA board approves the  $50 Million it means we will be able to fill the reserves.”

Buluma commended Reserve Bank of Malawi for coordinating the financing.

Another good news according to Buruma, NOCMA is also in talks with Afrexim Bank for $45 Million facility.

Malawi Energy Regulatory Authority  (Mera) chief executive officer Henry Kachaje says the country is facing fuel and forex shortage situation because it has not doubled generation of forex despite demand for forex going up.

Kachaje said for fuel alone, the country needs $600 Million per year but tobacco, which is the major forex earner for the country, only brings in about $200 million.

He said the country needs to have a conversation on how it will double forex generation.

BADEA is financed by the member countries of the League of Arab States. Its

operations started in 1975. BADEA’s mission is to foster the economic development of non-Arab African countries, encourage Arab capital participation in Africa, and provide Africa with the necessary technical assistance. In 1977, the resources of the Special Arab Fund for Africa were merged with those of BADEA.

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