Thursday, May 30, 2024

Removal of Government from procurement of fuel should be supported- BOZ Governor

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BANK of Zambia Governor Denny Kalyalya
BANK of Zambia Governor Denny Kalyalya
BANK of Zambia governor Denny Kalyalya says the decision to remove Government from direct engagement in the procurement of fuel should be supported as the measure will save the country millions of dollars spent when importing the commodity.

Last week, Minister of Finance Felix Mutati said Government will no longer be a key player in the procurement of fuel but will instead allow the private sector to take up the responsibility by March 2017.

Government spends in excess of US$100 billion per annum in subsidising prices of maize, mealie meal, fuel and electricity.

When asked about the impact of the removal of consumption subsidies and engagement of the private sector to procure fuel, Dr Kalyalya said the central bank has welcomed the move taken by Government.
“Subsidies are not sustainable since the country doesn’t have resources. Government has challenges, for example, importing fuel in US dollars but selling the commodity in Kwacha, do you know how much the treasury loses when there is a slight change in the foreign exchange market?

“Of course, we all need cheap fuel, but do we need to be subsidised? How many cars are arriving in Zambia on a daily basis? Who is running the various fuel service outlets? As a country, we need to address this challenge so we welcome the engagement of the private sector to procure fuel because we don’t have resources but the private sector has and can handle it,” he said.

Dr Kalyalya said the engagement of the private sector to procure fuel is a matter that can be handled by relevant authorities.

“It is a regulatory issue just like we [BoZ] regulate banks, the Energy Regulatory Board can do the same,” he said.

15 COMMENTS

  1. Bambi bola naiykosa.
    PF music pleas , let’s dance then we can have national prayers then dance some more

    Dununa reverseeeeeeeee…..

    • Of course Johnstone Chikwanda & his kind who benefit from middlemen are not happy.
      Problem is ERB will create funny regulations so that the OMCs start “oiling” them.

  2. Yes kill Zambian mentality of looking at the Government like a feeding bottle. UNIP spoiled us alot with dependency syndrom.

  3. “Government spends in excess of US$100 billion per annum in subsidising prices of maize, mealie meal, fuel and electricity” How do you manage to spend US$100billion per annum, when your total budget is US$6.4 billion. And so far you only have a debt of US$6.7 billion. and you have no reserves. so what magic is there to spend $100 billion, beyond your debts, budget and reserves?
    Its a good move for govt to stay away, moreover, we just make few individuals rich. But hopefully, the private sector will keep enough reserves

    • @ Hamuntu. Good observation. I dare say LT journalists just write anyhow without checking the facts. They don’t bother to correct mistakes; misleading the world.

      One wonders where this realisation was hidden if not conveniently ignored, until now, for oiling a tandem of corrupt government individuals.

  4. (Government spends in excess of US$100 billion per annum in subsidising prices of maize, mealie meal, fuel and electricity) $1 Billion bafikala atase

  5. $100 billion my foot, when you only have about $2.5 billion in reserves. Can these morons be serious for once and accept the fact that they have failed to run the economy not until the likes of Mutati have come in to show them how to manage the fiscal element which has been missing all along. This guy can not compare to Fundanga, the genius of micro economic management who had a foresight and vision for the country and not these bootlickers hell bent on pleasing their master. No wonder they are crying foul that new comers have been given important posts in government, what do you expect from these misfits?

  6. Apa bola naiykosa.

    Wait and see…..you went to watch lungu dancing dununa reverse and the kaponyas shouting sontapo……then they told you to go and pray……now the real dancing will start.

  7. Were you not taught in school on how to correctly adjust figures in your head if you read something not adding up…..that was a typing error,just correct it in your head and do not dwell so much on it man…….he ment $100 million man!!!!!!

  8. Kkkkkk $100billion subsidy my foot.
    just hand it over to the private sector so that they can also treat us in which ever way they want.

  9. Assuming at the current price Govt is not making any profit, it means the private sector which will be involved in procuring fuel has to add a mark up for them to remain viable meaning the fuel prices will go up. Currently Unleaded Petrol is Zambia is selling at 41% above World average of 0.91Eur/ litre while Diesel in Zambia is selling at 33% above World average. Source of data: mytravelcost.com. Is this sustainable for the average motorists whose source of income has either remained static or dwindled?
    The Private sector will still use our Dollars from BOZ to import fuel, so then how are we going benefit as citizens?

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