Zambia is on course for a major reduction in fuel prices, thanks to the economic reforms and transparent bidding processes introduced by the United Party for National Development (UPND) government. While fuel prices have not yet dropped, recent developments in fuel procurement indicate that significant reductions are expected in the coming months.

For years, Zambia’s fuel pricing system was riddled with inefficiencies. Under previous administrations, the government relied on subsidies to artificially lower fuel prices, while the actual costs remained hidden. This approach was not sustainable, as it placed a heavy burden on the national budget. Recognizing this challenge, the UPND government took a bold step by removing fuel subsidies to establish the real cost of fuel and allow the market to dictate fair prices.

In addition to removing subsidies, the government revamped the TAZAMA pipeline, transitioning it from transporting crude oil to refined low-sulphur diesel. This shift has helped reduce transport costs and improve efficiency in the fuel supply chain. However, one of the most impactful changes has been the introduction of open bidding and competition among Oil Marketing Companies (OMCs).

Previously, fuel procurement was dominated by a few suppliers, limiting competition and keeping prices high. The UPND government opened access to the TAZAMA pipeline, allowing multiple suppliers to compete. This move has forced companies to bid competitively, ensuring that fuel is procured at the lowest possible cost.

Recent bidding results for the May 2025 fuel contracts confirm that these reforms are working. Agro Fuel Investments Limited, which had previously quoted fuel at $113 per metric ton, lowered its bid to $54.12 per metric ton in order to remain competitive. Due to Energy Regulation Board (ERB) rules, all other suppliers must now match this lower price, meaning Zambia is set for one of the most significant fuel price reductions in years.

While fuel prices have not yet dropped, these developments signal a clear shift in the country’s fuel pricing structure. The UPND’s approach of market-driven pricing, infrastructure investment, and open competition is creating a sustainable solution that will benefit both businesses and consumers. Instead of relying on subsidies that drain government resources, the new system ensures that fuel prices decrease naturally through fair competition.

As Zambia heads toward May 2025, all eyes will be on the implementation of these lower fuel costs. What is clear, however, is that the UPND’s policies are paving the way for a more stable, transparent, and affordable fuel market, a development that will have a lasting positive impact on the economy.

By Adrian Gunduzani

President Hakainde Hichilema has repeatedly touted the Constituency Development Fund (CDF) as one of his main political successes. At the current rate, each constituency is set to receive almost K150 million. On paper, this is a significant amount of money poised to transform Zambia permanently. With three cycles already completed, one wonders how the respective constituencies managed to spend over K80 million—only the president knows.

Unfortunately, the effectiveness of presidential ideological programs in Zambia has long been a subject of debate, primarily due to their alignment with the interests of the sitting president. Often, these programs are designed more to bolster the president’s public image than to effect substantive development. Instead of yielding tangible results, they typically lead to a cycle of disappointment and resource misallocation, with successive administrations perpetuating a pattern of inefficiency emblematic of post-independence governance.

Since independence, various presidential initiatives—from cooperatives to agricultural advancements, and more recently, the Constituency Development Fund—have consistently demonstrated poor returns on investment. Millions of Kwachas have been spent with very little to show for it. Despite official proclamations of success, these programs have been characterized by a wastage of state resources. At best, they lack accountability, while government-controlled media project an image of progress. Unfortunately, comprehensive accounting of the financial losses incurred due to these initiatives remains obscured. One still cannot find a report on the misuse of these funds—conspicuously keeping hidden the corruption that underpins these programs. This recurring theme can aptly be described as “the Zambian way.”

Today, President Hakainde Hichilema’s management of the CDF exhibits similar shortcomings. State media outlets convey assurances of its effectiveness; however, the outcomes suggest otherwise. High-profile expenditures—such as the procurement of police vehicles and ambulances using CDF allocations—raise critical questions regarding the logic underpinning this funding strategy. With established ministries, such as the Ministry of Health and the Ministry of Home Affairs, designated to oversee such assets, one wonders why these ministries do not utilize their respective budget lines for vehicle acquisitions. Instead, it appears that these purchases serve as instruments of political propaganda aimed at projecting the flawed success of a fundamentally misguided ideological program.

Furthermore, a notable characteristic of these programs is the substantial funding allocated without robust mechanisms for accountability. The overarching political motivations driving these initiatives often exempt them from the scrutiny typically demanded of public expenditure. Questions surrounding project viability and oversight remain inadequately addressed: Who assesses the effectiveness of the funded projects? What accountability frameworks exist for beneficiaries who apply for or misuse allocated funds? Who qualifies to evaluate the viability of a cooperative or loan applicant? And what are the consequences of failing to repay loans? While local government has been designated as the appropriate administrative body for these funds, doubts persist regarding its capacity to manage the array of projects inherent to the CDF. The ministry’s original mandate did not include administering the CDF; in short, it is not qualified to manage it. The president should have established a different body to administer this fund!

As Zambia approaches the 2026 elections, one can anticipate an intensification of propaganda surrounding the CDF. However, despite the claims dominating the Zambia News and Information Services (ZANIS) and the Zambia National Broadcasting Corporation (ZNBC), a dissonance exists between official narratives and the lived experiences of the populace. The critical question persists: How much public money has been expended on these initiatives, and how does that figure compare to the positive outcomes depicted in governmental communications?

In summary, the CDF—much like its predecessors—risks relegating itself to the annals of political rhetoric, devoid of genuine accountability and effective governance. The challenge remains to break free from the cycle of propaganda and demand a more transparent and responsible approach to public resource management in Zambia. The CDF is, at best, wasted money, and at worst, stolen money!

By Kapya Kaoma

Journalist and Human Rights activist Laura Miti recently wrote about some unfortunate experiences her newly established small restaurant has faced with the police. In relating her infuriating ordeal, she also touched on the heavy cost of doing business in Zambia. “Take Ipesheni [the restaurant],” she wrote on her popular Facebook page, “we have made sure we have paid the crazily expensive fees a business needs to be fully compliant in Lusaka.”

At the end of her post, she re-emphasizes that painful point: “I will say it again – it is very difficult to make honest money in Zambia. The legal requirements to operate are already laborious and, as said above, punishingly costly. Then we must add the police being random. I’m sure other establishments suffer other authorities.”

Politicians and technocrats keep coming up with all kinds of convoluted “national development plans” that they sincerely think will one day cure Zambia’s chronically ailing economy. Zambia is now on the 8th national development plan, with absolutely nothing to show for it, because these “plans” are actually useless, if not destructive. We have been doing them since the time of Kenneth Kaunda when he copied them from the former communist Soviet Union, without stopping to ask whether they ever produced any meaningful improvements in people’s livelihood.

The only real secret to “development” has always been hidden in plain sight: reduce the costs of doing business and the economy will boom. That’s all. It doesn’t matter if it’s small businesses or big businesses, the government must not make business harder than it already is by having so many costly regulations, fees and taxes. On top of this, they even decide to add other random costs like irrational policing of these small companies that are trying hard to just stay afloat. It’s almost as if they are trying hard to keep the country poor!

President Hichilima, as a businessman, already knows these things, so we were hoping he would do better than his predecessors. So why has he not aggressively implemented an environment that is pro-business?

All our politicians fall into the same trap once they get into power: they start trying to directly help people, instead of doing it indirectly by letting businesses grow so that they can be the ones to employ them and improve their lives. A small restaurant might not employ too many people, but if the owner sees that they are making a lot of money, they will be motivated to open another one, and then another one, or at least to grow the size of the restaurant by introducing more ideas to win new customers. Whether they are mainly doing this for profit or because they just enjoy serving people, it will result in more and more people getting jobs – real jobs that actually make money in the economy. The suppliers they are buying their vegetables and chickens from will also make more money, and end up hiring more people to help them. That’s the only formula for true economic growth.

This is a much more effective way than trying to give people government jobs. You can keep boasting about hiring 10 thousand new teachers or nurses when the economy could have produced 1 million jobs if you had just allowed businesses to operate freely and cheaply.

Many people feel guilty when they oppose government programs that give people free government jobs or “social cash transfer” or “CDF” or “cash for work” or “cash for pregnancy” or many other economically useless programs. You feel guilty opposing such programs because you sound like you don’t care for the suffering people. And yet those same policies of expensive expenditures are the ones that keep the same people poor. To fund those programs you need to keep the taxes (or “fees”) high. And by keeping taxation high, you are just making it more impossible for more people to become employed.

Abolish all these harmful “social” programs and unleash the businesses to be the ones to solve the problem of poverty, by unburdening them from all the unnecessary costs, including the invisible tax of impetuous policing.

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The author, Chanda Chisala, is the Founder of Zambia Online and Khama Institute. He is formerly a John S. Knight Fellow at Stanford University and Visiting Scholar to the Hoover Institution, a policy think tank at Stanford. You can follow him on X @chandachisala.