The United Liberal Party (ULP) has called on government to reconsider its decision to stop subsidizing fuel.
ULP President Sakwiba Sikota said that government’s move to stop subsidizing fuel has a possibility of affecting the cost of doing business in the country.
Mr. Sikota noted that removing subsidies is also likely to affect prices of most goods and services and performance of the economy which has shown some signs of recovering.
He said tourism, manufacturing, and agriculture sectors are some of the industries that would be affected with adjustment in fuel prices resulting from government’s decision to withdraw subsidies.
He pointed out that in the agriculture sector, it would mean that the cost of transportation of both farming inputs and produce will change while in the manufacturing sector production costs will be adjusted upwards.
Mr. Sikota said the withdrawal will also negatively affect economic activities resulting from reduced business owing to high prices of acquiring and transporting of raw materials in and outside the country.
He stated that Zambia will most likely fail to compete favourably in regional trade through the Common Market for Eastern and Southern (COMESA) customs union because of the high costs that will come with exporting of finished goods and other products to other countries in the region.
The ULP leader said that he agrees that government needs to channel resources to other equally important sectors in the economy for development projects.
But he said that the government could look for funds from other sources other than stopping to subsidies fuel.
He also told government to explain how it intends to utilize the Strategic Reserve Fund (SRF) for fuel since it will not be used to help mitigate the high cost of fuel in the country.
He added that The SRF was established to pile up stocks of fuel so that in times of shortages, fuel could be offloaded on the market to stabilize prices and also in times such as today when fuel costs increase rapidly, fuel stocks could be released at a lower cost.
“The ULP is proposing a gradual review of the subsidies on fuel so that it can also include finding cheap alternative sources of fuel,” Mr Sikota said
Mr. Sikota said a gradual withdraw of fuel subsidies will also give enough time to all sectors of the economy to effectively adjust their expenditure on fuel without incurring major losses.
[ QFM ]
I donnot know where this guy belongs, is he a cadre for RB ! why is he so confused the Lozis need apresident in you be serious , and fight hard you cannot be a president if you want to be relaxed even when you are supposed tobe working that is my advise
This development ends the silly fantasy that the Rupiah Administration navigated the global recession well. There was no navigation- just ukwa lola umwela- eko twa lola mayo…That was pure propaganda and politricks. Like Greece, Zambia has started to feel the real effects now. This non-thinking government should have made sure they pumped money into the mining industry which is the backbone of our economy to continue production at the time- instead of having the mines on go slow…stock-piled that copper and waited for an opportune time to sell it…Anyway “sembe” does not work.
Government should just reduce taxes on the fuel they are charging to reduce the cost instead of subsidizing. Mr Sakwiba belongs to sleeping politicians who waits for election to wake up and support another party. This time around he seems to be fixed i doubt whether he will support MMD. He may support another Lozi (ADD) to confuse the Lozis.
Such are the leader that drove this country into the ditch we are in. Honestly how can some sikota expect government to borrow money just to subsidise business? Much as I don’t agree with the cost of fuel wich is the highest in the region. One thing whic
h fact is that These business have been operating in a bubble economy. Its high time we got real.
Such are the leaders that drove this country into the ditch we are in. Honestly how can some sikota expect government to borrow money just to subsidise business? Much as I don’t agree with the cost of fuel wich is the highest in the region. One thing whic
h fact is that these businesses have been operating in a bubble economy. Its high time we got real.
What sort of economics is Sakwiba trying to employ. World oil prices are not determined by a single factor and the change in price has no pattern so how does Sakwiba expect the Govt to budget and subsidise the oil. Oil price can change from $ 70 a barrel to $ 120 a barrel in one financial year and how can subsidy work and where will the govt get money if such a drastic change was not budgeted for
Bo Sakwiba, have some brains. How is the veep rumour going anyway?
RB just put 5% subsidy and increase fuel tax by 5%, that way the likes of saki will be happy, net effect on govt revenue wllm be zero. keep ZRA busy with unnecessary paper work putting and remoing the same amonut of money. epela
#4,6 &7 …..I agree with you. This chap is really dull. He needs to go back back and do Economics 101. And he is a Sate Counsel? In fact the School of Law at UNZA MUST teach basic economics to these chaps its so amazing how ill equiped they are.
Well spoken Mr Sikota, we love to hear that. But in an economy whose budget is heavily subsidised by donors where would the government find the money to subsidise fuel prices, and fund salary increments at the same time? If you have such a donor in mind please share with us.
#2 the government should have pumped money into the mines? Come on bane, let’s not be jokers.
#10:I am very serious. Perhaps I should have expanded more. It’s rather complicated, but just to give you an overview. The mines have a lot of Zambian owned small businesses which are completely dependant on mine production being constant in order for them to survive. When the mines went on go slow to “save costs”, the immediate victims were the mine’s peripheral businesses- the lifeblood of the C/belt. Now these small businesses usually borrow heavily from the bank as they supply good and services. The mines having slowed production, did not need this excess goods and services, so these small businesses went into serious debt-Zambian banks charge high int rates…My cousin is a small business owner who is one of hundreds feeling the effect now as the banks want their money back…