Price Hikes & more – 16th Nov 2023

Muli bwanji from BA! This is the Rorshok Malawi Update from the 16th of November twenty twenty-three A quick summary of what's going down in Malawi.

Last Wednesday, the Reserve Bank devalued the Kwacha by 44%. Since then, numerous companies have been hiking the price of their goods too.

The first company to do that was the Malawi Energy Regulatory Authority (or MERA), which hiked the prices of petrol, diesel, and paraffin on Friday the 10th, effective immediately. Petrol is now selling for 2,530 Kwacha or one dollar and fifty cents per liter, up from 1,746 or a dollar and six cents. Diesel sells at 2,743 Kwacha or a dollar and sixty-three cents, from 1,920 or a dollar and fourteen cents. This means the price of petrol increased by 44%, while diesel suffered a 42% hike.

That same morning, commuters paid the new and hiked fees to get to work. One of the hardest hit places was Lilongwe, whose areas are far apart. For instance, minibusses now charge 1,650 Kwacha or ninety-eight US cents to get passengers downtown, up from 1,200 Kwacha, or seventy-one cents.

Traveling between cities has now gotten expensive, too. People traveling from Zomba to Blantyre now have to pay a bus fee of 6,000 Kwacha, or three dollars and fifty-six cents, instead of 3,500 Kwacha, or two dollars and eight cents. On Friday the 10th, Clifford Chilombo, a taxi driver, told local media that people were commuting less due to their price hike.

Coaches also announced price adjustments for city travel. For instance, on Saturday the 11th, Sososo Coaches announced new fares for journeys from areas such as Blantyre to Lilongwe, Lilongwe to Mzuzu, Mzuzu to Karonga, among others. Most of these have had a price adjustment of 10 to 20 thousand Kwacha, or six to twelve dollars.

Other affected commodities include electricity, sugar, and alcohol.

MERA increased electricity tariffs by around 41%. According to their statement released on Friday the 10th, MERA takes monthly reviews of electricity tariffs to assess the impact of the exchange rate on licensed businesses, ensuring the tariffs by the Electricity Supply Corporation (or ESCOM) reflect the current Kwacha to dollar exchange rate.

The price of sugar went from 1,500 to 2,000 Kwacha per kilogram; it increased from eighty-nine cents to a dollar and nineteen cents. However, an Illovo Sugar Malawi statement released on Friday the 10th explained that, apart from the devaluation, other issues, such as the forex shortage, were considered for the price hike.

Meanwhile, on Friday the 10th, Castel Malawi Limited announced a price increase for all the products in their Beer category, effective immediately.

While most companies have hiked their prices, South African Airways (or SAA) has chosen to opt out of the country. On Friday the 10th, SAA immediately suspended all their air ticket sales in Malawi. Instead, locals will have to book or purchase tickets outside of Malawi using foreign currencies. This means citizens can still get tickets online and pay in forex.

However, SAA said their Malawian flight operations will continue. So people can still fly from Blantyre or Lilongwe to Johannesburg and back.

To “soften the blow” of the devaluation, on Monday the 13th, Simplex Chithyola, the Finance Minister, announced measures meant to protect vulnerable communities. These include social cash transfers to three million households— that’s 15% of the population. He also said the Treasury will continue implementing recovery interventions for Cyclone FREDDY to close to 200 thousand households across Malawi. They also urged employers to raise their employee’s salaries.

Unfortunately, many considered these measures a joke and have been mocking Chithyola since.

On Wednesday, the 15th, President Chakwera announced his own austerity measures. This comes after the International Monetary Fund granted Malawi an extended credit facility worth 700 million dollars in budgetary support on the same day.

Among others, the President canceled his and other cabinet members’ external travel until next March and ordered all ministers out on external travel to return immediately. He also ordered that the cabinet member’s fuel allocations be cut by 50% immediately.

His speech has been called into question, as it might have polarized society. Some think this is the leadership Malawi needs, while others have lost hope in him keeping his word.

Amidst the devastating price increase, some people are mourning the loss of their goods. This is due to a fire that burned down Dossani House in the heart of Blantyre city on the night of Friday the 10th. Local news shared a live-scene video of the fire. No one could make up why it started or which companies in the building were affected, considering that the fire took place in the dead of night.

The police are yet to give more details on the matter.

Other locals are facing an indefinite power outage.

Thieves vandalized two main electricity towers belonging to ESCOM in the early hours of Monday the 13th. The incident happened at Kapichira in Chikwawa district.

Masauko Mula, ESCOM’s Director of Transmission, bemoaned the theft, saying it would require over 200 million Kwacha—roughly 120 thousand dollars—to fix the damage. Currently, some areas in Chikwawa and Nsanje districts have no power due to the vandalism. Some don’t have internet either, as the power lines were connecting fiber optic cables for the Internet.

Mula said they will use makeshift poles while waiting to procure the appropriate resources.

Police in Kasungu are looking for thirty-seven-year-old Paul Matias for kidnapping eight girls aged between sixteen and twenty-three.

On Sunday the 12th, Joseph Kachikho, Spokesperson for Kasungu Police, said that Matias took the girls from their parents in Ntchisi district in October. He told them he worked for a local firm that pays for children’s school fees, and promised that he would send the children to boarding schools. However, upon arrival in Kasungu, Matias rented a house for the children and raped them until last weekend, when one of the girls reported the issue to the police.

Kachikho said they have rescued the girls, but Matias is on the run.

Gabadinho Mhango, the striker for the national men’s football team, will not be playing the twenty twenty-six Fifa World Cup qualifier match against Liberia that will take place this Friday the 17th.

On Tuesday the 14th, Patrick Mabedi, the coach for the Flames, said Mhango missed his flight on Sunday the 12th from South Africa to Malawi, where he was supposed to unite with his team and travel together to Liberia ahead of their game.

On Wednesday, the 15th, the Football Association of Malawi arranged for him to travel to meet his teammates in Liberia, but Mabedi refused, citing disciplinary reasons.

On the flip side, maybe Mhango will join the Flames’ match against Tunisia in Lilongwe next Tuesday.

And to close this edition, Michelle Obama and Melinda Gates left the country on Wednesday the 15th, after quietly jetting in on Monday the 13th. Local media said they went to Malawi under heavy security in the middle of the night, and security personnel chased away journalists who had traveled to the airport to cover their arrival.

According to reports, Amal Clooney, a Human Rights Lawyer, accompanied the two women. They went to the country to support Malawi’s efforts in fighting against child marriages and advance gender equality. They interacted with some of the beneficiaries of their initiatives, some of whom were three hundred students from Ludzi Girls and Mchinji Mission Secondary School, both located in Mchinji district.

And that’s it for this week! Thank you for joining us! Before we leave, we wanted to thank everyone who has been listening to us, and welcome all the new subscribers! We are happy the Rorshok Malawi community is growing!

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Pitani bwino!