The Petroleum Transporters Association of Zambia (PTAZ) has backed the recent hike in fuel pump prices necessitated by the removal of subsidies on the commodity by the Government.

PTAZ is an association with a membership of 96 transporters owning over 800 fuel tankers that distribute fuel throughout the country and transporting fuel from the ports into Zambia.

PTAZ Secretary General Benson Tembo has branded the increase in fuel prices as long overdue.

The Energy Regulation Board (ERB) last week announced an upward adjustment of pump prices of petroleum products between 3 Kwacha 54 Ngwee and 4 Kwacha 47 Ngwee following the removal of subsidies on the commodity.

Speaking in Ndola, Mr. Tembo said the old fuel pump prices in Zambia were artificial and were only sustained for political reasons by the previous Patriotic Front Government.

“This bald decision made by the Government is long overdue. It has been eating on the progression of this country. We are in the fuel transport subsector and we have been involved in the movement of the product throughout the country and the movement of the product from the ports into the country,” Mr. Tembo said.

“We are aware of the activities that have been happening prior to this fuel price adjustment; I want to say that the price adjustment you have seen today would have happened in November, 2020. The oil marketing companies were demanding price adjustments at that time because of the landing costs.”

“As you are aware Indeni has not been operational since last January and all petroleum products in this country have been imported as finished products. And local oil marketing companies (OMC) were given import waivers to bring in these products so along the supply chain the landing costs went up and the OMC demanded that the Government increase the pump price but during that time the Government was hesitant to increase because of politics,” he said.

Mr. Tembo added:”Instead in January and February, the Government decided to suspend the VAT, excise duty and all other fees in the price buildup just to maintain the price up to August elections. Unfortunately that Government was booted out and we have a new Government, so today when there is this price adjustment what we are saying as critical players in this sector is that this was a very bold decision that will bring back the country on track, a decision that will bring back the country on economic revival.”

“If you look around, we have been transporting fuel from Beira (Mozambique), we pass through Zimbabwe. The product in Zimbabwe is expensive. We have been transporting fuel from Tanzania; we pass through Tanzania the product in Tanzania is expensive. The question has been why is the Zambian product cheaper? It is politics, politics and politics. Now that politics are over we expect the members of the public to rally behind the Government so that we can go to the other side where we will see progression.

Fuel price increment announced by ERB has sparked bus-fares hike confirmed by the Road Transport and Safety Agency (RTSA) on Monday.

Association of Vendors, Traders and Marketeers of Zambia (AVETMZ) has warned the government against agitating the hundreds of street vendors across the country by removing them from the streets without dialogue or providing proper alternative trading spaces in available markets.

Association General Secretary Musonda Mushota says it is contradictory of government to first hike fuel prices leading to an escalated cost of living and then tempering with peoples source of income abruptly by removing them from the street when there are no available trading spaces in markets.

Mr. Mushota is urging Local Government Minister Garry Nkombo not to declare a one-man war on the informal sector but rather engage stakeholders to find a proper solution including designating some streets for regulated vending.

He was reacting to Mr. Nkombo’s directive yesterday to all street vendors to vacate the Lusaka Central Business District.

And Association president Fredrick Tembo is urging President Hakainde Hichilema to intervene in the matter and this process halted for Lusaka, Kitwe, Ndola and Livingstone until new markets are complete to accommodate all the traders.

Mr. Tembo says there is also a need for a quick meeting between local authorities, the Ministry of Local Government and market associations to find a lasting solution to this matter as opposed to forcing matters while the economy continues to negatively affect street vendors.

Mr Tembo said that his association has strongly opposed the wholesale removal of street vendors in major cities such as Lusaka and that the removal of vendors from streets by the Government should be done gradually, adding that asking all vendors must leave the streets will have a negative impact on his members.

He said AVETMZ was aware that currently, Zambia does not have the adequate market infrastructure to accommodate everyone operating in the streets.

“As the Association of Vendors, Traders and Marketeers of Zambia we want to argue what the Honourable Minister of Local Government Garry Nkombo has said over the removal of street vendors. I think as at now if we look at the status of the economy, it is biting and people are complaining so if we are going to take that hard step that street vendors should be removed from the streets then we are going to add salt, I can rest assure you that there will be dust,” he said.

“Quiet ok we appreciate the Government’s efforts as at present they are constructing massive modern markets but the truth of the matter is that those markets should be completed. It is very important that the minister calls for a national indaba, we have a very big meeting with us, the union, the people who speak on behalf of these people. It is very important that they engage us; we gave them ideas to say Mr. Minister and your Ministry we can be moving vendors into markets in phases,” Mr. Tembo said.

“As we are talking right now, my brothers, my mothers, and my sisters who are on the streets are surviving from those K2s they are getting on a daily basis but if we are going to take a position to remove them, we are going to create what we call social problems. We will be experiencing increased prostitution, stealing and other illicit activities because of the decision to remove vendors from streets,” Mr. Tembo said.

“We are in the rainy season, and you all know that in the rainy season every individual complains about the status of living. My humble appeal even to the President of the Republic of Zambia, Mr. Hakainde Hichilema please let this thing be rested first. Let us call for a meeting, a proper one. Let the council come on board, the market associations and the Government. We sit down and plan,” he said.

Government has maintained that the recent removal of subsidies and tax incentives on some petroleum products was inevitable as it was an important measure to actualizing the economic reform which Zambia is currently going through.

Director and Spokesperson in the Ministry of Information and Media, Thabo Kawana told ZANIS today that before the hike, the prices of petroleum products were artificial.

He said prices did not correspond with the trends on the international market and exchange rate.

Mr. Kawana explained that due to the continued subsiding of fuel prices, government was spending about 67 million United States Dollars per month and over US$ 800 million per year on fuel subsidies.

He added that government also accumulated a debt of US$500 million owed to Oil Marketing Companies for the supply of the commodity.

Mr. Kawana said the government had to take the hard decision of removing subsidies on fuel in order to save resources for other equally important sectors such as health and education.

He explained that the savings from the removal of subsidies and tax incentives on petroleum products will be allocated to the constituency development fund and used for the recruitment of teachers and health personnel in the country.

Mr. Kawana has, meanwhile, expressed optimism that once the economic reforms are done in the next two to three years, Zambians will feel the benefits of the decisions which are being undertaken currently.

He has since appealed to Zambians to exercise patience as government is working on restoring the economy that will result in improved development and wellbeing of people.

Last week, the Energy Regulation Board (ERB) announced an upward adjustment of pump prices of petroleum products between 3 Kwacha 54 Ngwee and 4 Kwacha 47 Ngwee following the removal of subsidies on the commodity.

Meanwhile, Economist Professor Oliver Saasa has urged the government to remove middlemen in fuel procurement in order to reduce the cost of the commodity following the removal of subsidies.

Professor Saasa said that the removal pf middlemen will also mean reviewing the tender process to ensure that the right bidders for the supply of fuel are awarded the contracts.

He said the government should also thoroughly explain why it was necessary to remove subsidies on fuel and electricity before its good intentions are misunderstood by the ordinary Zambians.

Professor Saasa said the recent removal of subsidies on fuel is a necessary evil which the country needed but said the government must also come up with measures which will help lessen the impact of such a move on ordinary Zambians.

Social Economist and Marketer Kelvin Chisanga say copper’s good performance on the international market signals positive economic trajectory for Zambia.

The copper has in recent months shown some relatively good performances, as it jumped to 3.3% to settle at $9,507.50 a metric ton on the London Metal Exchange.

Mr. Chisanga said copper’s stable prices demonstrated in recent times can support Zambia’s economic fundamentals during the New Dawn government’s budget transition period.

Mr. Chisanga, who is also a Business Administrator and Communication Strategist, also called for a stable mine tax regime.

“The expectations of having over three (3) million metric tonnes projections for copper’s output capacity or production in the next 10 years is such a welcome idea, given the circumstances that we have reduced some of the risk factors that the mining regime had quite experienced in the last 10 to 15 years where there were some seemingly aggressive policy inconsistencies since 2008, which may have been blamed on market fundamentals as well as policymakers,” he said.

“The red metal (copper) commodity has shown some relatively good performances, as it jumped to 3.3% to settle at $9,507.50 a metric ton on the LME, and this is seen to show a biggest gain recorded so far in just two solid months, hopefully this will be trend to continue seeing going forward, we anticipate that the red metal’s stable prices can support Zambia’s economic fundamentals during the new government’s budget transition period, as it takes down to start stabilising within the course of first quarter of 2022.”

Mr. Chisanga said it was unfortunate that Zambia has not had a stable mine taxation system in several years.

“It’s indeed regrettably to note that Zambia has changed mining tax regime for about 15 times, which has been very unhealthy for the economy, despite receiving a bad shape in 2016. It is however commonly to state that Zambia’s economy at some points came under a serious stress between the financial period of 2015 and 2016 as external headwinds coupled with domestic pressure played a severe card on our economy.”

“As we saw on how Copper prices were drastically plunged by a margin of more than 20 percent during the same financial period, and this was mainly attributed to a reduced global demand scale that had characterised with our solid commodity partner China.Even though, the country’s gross domestic product (GDP) grew at 2.8 percent in 2015 and 3.3 percent in 2016 respectively, though it recorded a figure much lower than the average 7.4 percent which was seen between 2004 and 2014, with the application of mineral royalty and there is growing evidence that the proposed MRT did extremely well despite having a projected revenue loss of about K3.2 billion for the planned 2022 fescues, it is highly anticipated that copper’s continued steady path line of growth trajectory may give us some compensatory benefits from the upward consumptive demands being projected as we will also have a good uptake in terms of productive output based on market assurance in the manufacturing of electric cars,” Mr. Chisanga stated.

He is also calling for mineral diversification that would see Zambia utilize more miners for its benefit beside the traditional copper and cobalt.

“Mining sector in the Zambian economy is such a huge sectorial undertaking, a key backbone to the nation’s economic structure. I think it’s good to note that the new government has undertaken a serious swift and bold actions to settle for withholding tax, VAT, import and export duty, and the mineral royalty tax which is strongly believed to have worked pretty well around 2014, as it was structured as a special mechanism to response to the then global commodity price slump which had taken place in the year 2014,” Mr. Chisanga observed.

“We further need to strongly make some necessary policies of promoting rapid economic diversification within the mining sector, targeting mineral resource or base outside copper so that we can quickly make special response to sectorial dominant challenges being faced with an overall mining industry in the Zambian case.”

Mr. Chisanga concluded:”It will be encouraging for government to remain quite resolute and steadfast to the negotiations of mineral royalties, with a view of ensuring that they don’t take negotiations further down given the circumstances that revenue from copper sales does not hit into our national treasury except for tax receipts and other related financial instruments.”