Lusaka based Economist Lubinda Habazoka noted that the reducing of prices of fuel is a move in a positive direction. This follows the change in cycle from three months to now monthly fuel price reviews by the new board at the Energy Regulation Board – ERB
Habazoka told the Zambian Business Times – ZBT that Zambians should not however expect a reduction in transportation and cost of daily commodities following this decrease in fuel pump prices.
The former Economic Association of Zambia President stated that the business community at the moment may not be certain if the prices of fuel will continue to go down and that there is always a general hesitancy in reducing prices by markets. The cost of goods and transportation may not reduce until there is some level of certainty on the direction.
There has been debate on whether the fuel price cut announced by the Energy Regulation Board on 31 January 2022 of about 6% for both diesel and petrol after the same prices were raised a month ago by between 20% to 30% was done based on economic fundamentals.
The debate is that fuel which is an imported commodity in Zambia has been adversely affected following the Kwacha depreciation. The Kwacha is now trading at about K18.2 per dollar while it was trading at K17.1 per dollar a month ago.
The government was accused of making political decisions as there was a by-election in Kabwata, an important Lusaka constituency that the ruling party badly needed to win to consolidate their claim of political support of the capital Lusaka.
And Chief Government spokesperson Chushi Kasanda refuted allegations that the reduction in fuel pricing was a political move targeted at winning the kabwata by elections.
In an exclusive interview with ZBT, Kasanda said government has put in place a system that is reflective of what is obtaining at the international oil market and follow the pricing of the international markets
Kasanda challenged those that think the fuel reduction had anything to do with politics to move on and support the government of the day than to just criticize even what she termed is right and positive decisions.
