Downward fuel adjustments

By Daily Revelation Editor

The Energy Regulation Board (ERB) yesterday reduced fuel prices for July 2024, with the highest drop being that of petrol by K3.98.

It’s not a good thing to be a cynic as cynics never develop nations. Therefore when things such as these happen, the move should be acknowledgd. The government must be commended for reducing the prices. Yes, this is still a high water mark given that the K31.58 for petrol and K29.34 is almost double the K17.61 for petrol and K16 for diesel the UPND administration found the commodities trading at on assuming office.

And the UPND must acknowledge responsibility for escalating the price of the commodity to such high prices, which unfortunately they are seeking to normalise, something we feel should not be the case. Nevertheless, a reduction is a reduction. What the administration should work towards now is to find ways of reducing these prices further downwards as K31.58 is still high a price that should not make those in government to sit on their laurels in celebration that they have reduced the prices. While commending them for this adjustment, we encourage them to work even harder to bring these prices to sustainable levels.

We all have seen the impact the high fuel prices have had on the general livelihood of Zambians, as the high prices have pushed up inflationary pressures in the economy, leading to the erosion in the Kwacha value and the very high cost of living, as prices have correspondingly risen with the fuel prices.

We hope the numbers in fuel prices and the Kwacha will continue trending downwards. More importantly, we also hope that businesses will correspondingly reduce prices of essential goods and services even as they are always ever quick to adjust prices upwards immediately the fuel prices are adjusted upwards.

But to maintain the downward trend, a lot of policy initiatives will need to be undertaken by the government. Piling more liquidity into the economy to help the Kwacha appreciate is superficial, not the most sustainable way of ensuring sustainability and stability of the local currency. What will sustain the Kwacha is the value in terms of exchange of goods and services, achieved by increased production and exports from the country. The minister of Finance will in the next two months be presenting the national budget, we hope the government will undertake to ensure increasing revenues from the mining sector, to cash in on the sky high copper prices currently prevailing on the international market.

Tax incentives for the productive sectors of the economy must be encouraged to ensure industry is kept afloat, especially during this very harsh period the country is going through in terms of the crippling load shedding, droughts and depressed economic growth, revised to just above 2 percent from the projected 4.8 percent for 2024.

The administration should further prioritise more investment into alternative sources of energy given the havoc the over-reliance on hydro-powered electricity has had on the nation on account of the droughts. While seeking to get more from the mining sector, the government should simultaneously get on a concerted drive into agricultural diversification.

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