RESIST THE TEMPTATION OF SLIDING BACK INTO SUBSIDIES, ENERGY EXPERT URGES GOVERNMENT.
….as he says the upward adjustment of fuel pump prices is a bitter pill but a necessary one especially that it is not a full pill…
Energy Forum Zambia Chairperson and Energy Expert Johnstone Chikwanda has encouraged the Energy Regulation Board (ERB) to resist the temptation of sliding the country back into subsidies.
ERB has announced and implemented new fuel pump prices of 20 percent and 30 percent on petrol and diesel respectively.
And in a statement this morning, Engineer Johnston Chikwanda said while these adjustments appear to be steep, they do not represent full removal of fuel subsidies.
He said the country is coming from an immediate past where over 41 percent taxes got waived in order to sustain price stability in an artificial position.
Engineer Chikwanda explained that if these taxes are added back, the pump prices are supposed to be far higher than even the new prices.
He has since stated that the new prices announced represent the commencement of a journey aimed at achieving cost reflective tariffs in the oil industry.
Meanwhile, engineer Chikwanda has commended the ERB for phasing the adjustment.
He says it is a bitter pill but a necessary pill especially that it is not a full pill.
The energy expert says the oil industry had become weak to the extent that Government had to start compensating some oil companies in order for them to keep on importing fuel into the country.
He says the extent of the fuel subsidies had become unsustainable and a major threat the national budget performance.
The Energy Forum Zambia Chairperson further stated that the removal of fuel subsidies is in line with Government portion as outlined in the Presidential speech to Parliament when he opened Parliament.
He says this position was also affirmed by the Minister of Finance during the Budget policy statement.
“They cause a lot of challenges and public sentiments when abolishing them causes is usually hostile.” Engineer Chikwanda said.