Mozambique: Malawi soon to become one of the biggest users of Nacala port

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Mozambique: Malawi soon to become one of the biggest users of Nacala port

10:29 CAT | 10 Feb 2022

File photo: Macauhub

The Malawi National Petroleum Company has announced that it will soon start importing fuel through the Nacala railway corridor.

The initiative aims to address the high cost of road transport from the ports of Beira in Mozambique, Durban in South Africa and Dar-Es-Salaam in Tanzania.

Malawi’s largest strategic fuel reserve, at Kanengo in Lilongwe, Is already connected to the Nacala rail network in northern Mozambique, and work connecting the Mchinji-Salima section with the Blantyre fuel reserve, in Malawi’s largest commercial hub, are 92% complete.

The executive vice president of the National Petroleum Company of Malawi, Hellen Buluma, said that the conclusion of the work, and subsequent import of fuel, would make Malawi one of the Port of Nacala’s biggest users.

Buluma explained that the road corridors in Beira, Durban and Dar-Es-Salaam currently in use have entailed high costs for Malawi due to limited carrying capacity.

Malawi pays US$10.00 per ton per kilometre against, the average SADC price US$7.00.

The high cost of transport affects Malawi’s economic competitiveness, hence the shift in business strategies from Beira, Dar-es-Salam and Durban to Nacala.

The city of Blantyre is about 2,300 km from Durban in South Africa, as also from Dar-es-Salam in Tanzania, whereas it is only 960 km from the Port of Nacala.

Malawi’s being a relatively small economy, with slow growth concentrated on a relatively small number of profitable products, the Port of Nacala is seen as a way of dealing with high fuel costs – to the detriment of Durban and Dar-es-Salam.

In Malawi, a litre of gasoline currently costs 95 meticais, and of diesel 90 meticais, which also adds to the cost of basic necessities.

About 17% of Malawi’s exports and imports of containerized cargo pass through the Port of Beira, and 13% of bulk cargo transiting the port is from that country.

Source: Lusa