The Malawi Confederation of Chambers of Commerce and Industry (MCCCI) has issued commentary on the recent fuel price adjustments announced by the Malawi Energy Regulatory Authority (MERA) on 20 January 2026. While the adjustment was intended to avert shortages, restore cost‑reflective pricing, and safeguard foreign exchange reserves, MCCCI notes that the impact on businesses is immediate and far‑reaching.
Petrol prices rose by 41.9% from K3,499 to K4,965 per litre, while diesel increased by 41.3% from K3,500 to K4,945 per litre. These steep hikes have intensified existing economic pressures, including persistently high inflation, acute foreign exchange constraints, and Malawi’s heavy dependence on imported fuel.
Transport and logistics operators, whose costs are heavily fuel‑dependent, have already announced fare and freight increases. Agriculture, which employs 80% of the population, faces higher costs for diesel‑powered tractors, irrigation pumps, and produce transport, squeezing smallholder margins and risking food insecurity.
Manufacturers reliant on generators during frequent power outages are seeing production costs rise sharply, eroding competitiveness and threatening jobs. Meanwhile, SMEs and informal businesses — the backbone of Malawi’s employment — are struggling to absorb rising input costs, with many at risk of closure or reduced operations.
A regional comparison underscores the severity of Malawi’s situation. In January 2026, pump prices in Malawi reached approximately USD 2.90 per litre, more than double Zambia’s USD 1.29 and significantly higher than Mozambique’s USD 1.25–1.31. This disparity places Malawian businesses at a competitive disadvantage in regional and global markets.
While the adjustment aims to stabilize supply and support IMF negotiations, MCCCI emphasizes that the short‑term pain is undeniable: reduced consumer spending, slower recovery prospects, and heightened risks of business contraction.
