Malawi has entered into a government-to-government fuel arrangement with the United Arab Emirates (UAE) aimed at addressing the country’s persistent fuel shortages and reducing foreign exchange expenditures, Minister of Trade and Industry Sosten Gwengwe announced on Thursday.
Speaking during a meeting with a visiting UAE delegation at the Office of the President and Cabinet in Lilongwe, Gwengwe said the deal would help Malawi cut its foreign currency spending on fuel and fertilizers, which currently amounts to approximately 1 trillion kwacha (about US$575 million).
Malawi has grappled with fuel shortages for several years, with supply disruptions leading to long queues at filling stations and economic slowdowns.
The crisis has been attributed to a combination of foreign currency shortages, logistical challenges and high global fuel prices.
The country has heavily relied on private sector importers who face difficulties in securing enough forex to sustain fuel supply.
The new arrangement with the UAE is expected to provide a more stable and direct fuel supply, mitigating the risk of frequent shortages.
The meeting with the UAE delegation followed President Lazarus Chakwera’s recent visit to the Gulf nation, during which he initiated discussions on strengthening economic ties between the two countries.
Beyond fuel, Malawi is also seeking similar government-to-government agreements in other sectors.
Gwengwe revealed that discussions are ongoing with Morocco to establish a direct fertilizer importation deal.
This initiative aims to ease the financial burden Malawi faces in acquiring fertilizers, a key component in the country’s agricultural sector.
JN/APA