Bank of Zambia Governor Caleb Fundanga has said ZESCO’s decision to increase electricity tariffs to 25.6 percent was justifiable for a growing economy like Zambia.
Dr. Fundanga said the increase in ZESCO tariffs was vital for increased production of power by the utility company.
The Governor also noted that the increase would help reduce the continued load shedding of electricity as the utility company would boost its production base.
He said increased power supply would result in increased consumer products which would help the country maintain single digit inflation.
Dr. Fundanga said this in an interview with ZANIS in Lusaka today shortly after the conducted tour of the BOZ stand at the 84th Agriculture and Commercial Show whose theme is ‘’Sustainable Development’’.
He also noted that the increase would also help ZESCO invest more in generation facilities such as the Itezi-Itezi power plant which is expected to be constructed this year.
Meanwhile, BOZ Deputy Governor for operations Denny Kalyalya said the central bank was working hand in hand with commercial banks in the country to ensure strict measures were put in place to protect customers’ accounts.
Dr. Kalyaya said restrictions had so far been put in place by various commercial banks especially on how much one withdraws from his account.
He stated that this would help both customers and the bank to monitor the operations of one’s account. He has since called on customers to report to relevant authorities once they noticed any abnormalities on their accounts.
Recently a scam was unearthed where some conmen had invaded the Visa system and in the process stealing money online leading to loss of income by members of the public.
ZANIS
Caleb Fundanga I have high respect for ,please dont insult the common Zambian,you say its justfied for Zesco to hike tariffs cause everything is paid for you by Bank Of Zambia so you dont know how it feels to pay bills from a teachers 1.2Million salary and feed.Please respect yourself Mr Bank Governer.What growing economy,just in your dreams and paper,where is the employment for the growing economy.please respect yourself..
The deputy BoZ Governor said the recent Zesco hike of over 25% was “painful” , now his boss says it is “justifiable”. Is the hike “justifiably painful”? Yes, for a low-income country like Zambia it is! But GRZ institutions must also pay cash for electrcity and no susbsidies to the mines. Let everyone pay their fair share and electricity would not be so high in Zambia.
2, That is just semantics my friend, no contradictions at all. Try “Necessary and justifiable though painful”. Does this make you feel better?
Another intellectual turning into an I d I o t to save his job. Useless fundanga. U were sounding snesible in levy/magande triange now u are like an empty tin. Time to go is now
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Chanda you are right , this people do not have any feeling for the poor and for people like Fundanga to vomits the way he did is disappointing for anyone who understands economics. I think in Zambia, leaders know to be lectured ….so it is all up to us the citizens to shame them…we will never show them mercy when they leave office. We teach them ….
In economics, money supply data are recorded and published, usually by the government or the central bank of the country. Public and private sector analysts have long monitored changes in money supply because of its possible effects on the price level, inflation and the business cycle
That relation between money and prices is historically associated with the quantity theory of money. There is strong empirical evidence of a direct relation between long-term price inflation and money-supply growth, at least for rapid increases in the amount of money in the economy. That is, a country such as Zambia has seen rapid increases in its money supply also saw rapid increases in prices (hyperinflation). This is one reason for the reliance on monetary policy as a means of controlling inflation in…
These F.O.o.L.s. What nonsense this is. This guy ought to be ashamed. Justifying nonsense to secure his undeserved pay. Someone please suggest paying Zesco seniors only what they deserve and getting MMD out of Zesco pockets. That is what will bring development to Zambia. Not the president running state owned companies and the central bank like they were his Bar petty cash accounts.
Iwe MB, #7, is Monetary policy practical in Zambia? How does BoZ manipulate money supply when interest rates don’t fluctuate but escalate? When and if at all they do go down, who benefits? Does that translate into increased borrowing by the private sector? How does that relate to mortgage rates? Without mortgage rates and decline in unemployment as a result of expansion of capacity by the private sector, we cannot say for sure that there is a functional monetary policy in Zambia. Does GRZ sale Government bonds? Through whom and to whom? How much per year?
Monetary policy is supposed to impact three things at the same time or in tandem:
1. Inflation
2. Unemployment
3. Growth
Problem in Zambia is that each time we have high corn yields we think we are experiencing economic take…
Somebody seriously needs to keep ZESCO’s foolishness in check. This company’s management is a joke. When they are done giving MMD campaign money, they propose a tarriff hike. I just wish for once as a people we can standup to MMD’s and ZESCO’s bullcrap and tell them enough is enough. MMD should find it’s own money for their pathetic campaigns. Now that Zamtel is no more, Zesco will be increasing tarriffs like a girl will change outfits!
Surely with a high salary that Fundanga gets and almost everything paid for by BoZ, the hike is justifiable to him. He has no clue how much we pay for rentals,fuel,power,school fees for kids etc. These are the same I.diots that were educated free of charge by KK but are today justifying high UNZA/college tuition fees. They have forgoten where they came from.
This is the worst case of an I.DIOT speaking. He thinks everyone gets K135million tax free like himself. This is a very S.TUPID statement especially coming from the BOZ Governor and in whose country the minimum wage is K260,000/-. These I.DIOTS are acting like they live in a fantasy world. Miners at Chambishi NFC & Copper Smelter are getting between K900,000 – K1,200,000/- as take home out of which an average of K250,000/- will be spent on Electricity alone. No wonder PF/UPND Pact IS SO SO POPULAR IN URBAN AREAS. WHAT AN I.DIOT!!
The increase is very unjustified. It sholuld have been 2% to 5% range. The question is what happens if the consumption drops? For all I know, not that many Zambians have a good earning to afford this kind of a hike (25%). For now the best a consumer can do is peacefully protest against the hike. There is nothing wrong wtih the idea.
Simply put-these BOZ is run by NWesterners where i come from. Kalyalya & Fundanga-These fellas have some retrogressive genes no matter how educated they become. Look where they come from, blessed with such huge reservours of natural resources than any other provinince pa Zed. Alas, even if he is talking about bumber harvest or Inflation harvest, agriculture is on peasant level and specifically to go round for a family. Other provinces are doing well in this area RB’s much better.
The reason for these praises is because this guy sits on money and who ever told a man NO! with money? The problem with figures is that it is possible to manupilate them even when the actual situation on the ground says the opposit. In zambia, we dont need these political intellectuals-all we care is a person…
The funding model that ZESCO is attempting to use for their expansion is dead wrong and unproven. Building a power station is not like procuring capital equipment or a simple matter. It is a massive investment and it takes on average 5-10 years to build one power station. To put is one the back of ordinary Zambians and people that what to do business in Zambia is ridiculous to say the least. For example ESCOM has got a $ 3.5 billion to build Mudupi power station from the World Bank. This is the right approach. We can ask the Chinese for concession loans in exchange for mining rights and fund our capacity building. This is already being done in Congo.
Cheap electricity stimulates the economy and the expensive electricity will economy to slow down and increase political risk.
Maria @15, i agree with your one point that instead of getting us indebted for something unnecessary like mandamandas or motoka chipatalas. On this blog i suggested the same but there will always be sons,daughters,bootlickers and jobseekers amoungst ourselves who will always object to such wise ideas because, for some there is no longterm,only from debtor to their mouths. It is ridiculous to obtain such loans in the name of development when, there are projects that require funds for sustainability.Zesco in particular & am sure these people even make a joke about those who suffer with these bills. I remember going in a house evacuated by this man with a bill of $1100. Zesco had no means of tracing him and there are many more out there because apart from providing for food,education and…
No 12 you are right on. These f.ools don’t know what it takes to pay K340,000. from a K1.2m salary and still remain with enough to feed, pay water, pay rent, take children to school, pay school fees, pay PTA fees, pay for transport – just to mention a few. Zesco f.ools get free electricity and they generally have very high salaries compared to teachers for example. So the hike is justifiable-Imbwa. Mwanya. God will puish you abundantly! This f.ool should not comment on such matters. He is too comfortable and does not see reality! Chimbwi amafi!
Zambian leaders are questionable as to whether they are in their right mind or not. How come leaders who are just next to each other contradict each other? The Bank governor and his deputy are cardinal to the economic growth of the country and if they are the ones who contradict each other then know that things are wrong? These are not just ordinary leaders but also scholars who also have statistics to depend on when telling their views. But when they contradict each other it means even their records and information are of different sources.The deputy BoZ Governor said the recent Zesco hike of 25% plus, was “painful” , now his Boss says it is “justifiable”. What a nonsense of Zambian leadership. Isabi ukubola litampila kumutwe. When the President is other wise what of the the…
The increase is actually 40%! Just check at Zesco…
4, That is typical cadre (PF/Pact) mentality. Whenever you are told a fact that you don’t want to hear, then that person is bought or protecting his job. For your information the Governor has been a supporter of ZESCO tariff hikes even during Levy’s era. He has not changed his position at all. He understands that it is a necessary evil but required to correct the ills in the power sector. It has nothing to do with who is in power. Even Sata will benefit from this when he assumes power in 2016.
18, That is just semantics my friend, no contradictions at all. Try “Necessary and justifiable though painful”. Does this make you feel better? The two are speaking the same language, no contradiction at all.
Electricity or energy costs are one of the reasons multinational companies set up businesses in countries. A good example is SA. In the 80s they had very cheap electricity and OVERCAPACITY. This is no longer the case since the ANC government went to sleep and stopped building power stations. Today companies have started leaving, some preferring to set up shop in India.
Companies need to know that the price will be low for extended period eg. 10 -20 years. If prices are fluctuating like a yo-yo, then the business risk is increased. It is a pity we have not put our best brains to solve this problem leaving it to accountants like the BOZ Governor to assess. This is a critical problem that requires the best minds and perhaps help from international energy organizations.
# 18 (The Saga) dont justify marabishi. There is clear contradcition in the statements between Fundanga and Kalyalya over electicity increase. Whereas Kalyalya like most of us complained, Fundanga is happy since he does not pay 4 electricity. Fundanga respect yoself and stop being S.T.U.P.I.D. If u have nothing to say better keep that mouth shut. Dont insult the poor, atase!
Sorry i meant # 20 or # 3 (The Saga) and not 18. Please # 18 u are very okay and i respect u.
Today I went to buy prepaid top up and one elderly man shook his head as K20,000 could only get him 7 units. Just last week I bought 137 units at K30,000. Today, from the same amount I only got 36 units. This is too much. I wonder what formula they are using to come up with these charges. Ba Zesco mwalatwipaya.
Our leaders need to get back to reality! Zambia is a poor country with the majority of workers on low wages (I mean low wages). If electricity tariffs are increased as planned who are we expected to survive? Our leaders want to compare the costs with neighbouring countries yet they never compare wages. How much do civil servants, teachers etc get in the countries the compare with. Also do they really expect us to believe that zesco is going to use the increased revenue for investing in power plants. As it is the extra costs will result in reduced consumption which will result in future increments. Zesco management can’t raise money from bonds or borrowings because they are not accpuntable. My advice to any overpaid zambian who’s utility bills are paid for by their employers is just keep…
Prices were increased by 40% for ordinary people. for our homes etc. That’s it. Not this nonsense of 25%. Why lie to people by communicating an average of Industrial user (who have a 12% increase) + us (people) and then when we go to power point we get heart attacks..