Fuel price reform could save K8bn – Mushimba
By Adrian Mwanza
ZAMBIA could save K8 billion annually if fuel procurement was restructured in a manner that responded to its oil market needs, says Organised People’s Party (OPP) president Dr Brian Mushimba.
Speaking to The Mast yesterday, Dr Mushimba said restructuring fuel procurement could help the country save about K8 billion per year in hidden costs from middlemen.
He said those given the responsibility to manage the procurement of the country’s fuel should realise that if fuel prices were not contained they would continue to swell, making the life of poor people miserable.
“There is a great need to face this reality that fuel prices, if not contained, will keep rising until we all won’t be able to afford life. The recent jump, as announced by the Energy Regulation Board (ERB), can’t be ignored because more of such will be coming if we don’t address some of the fundamentals in the fuel procurement as a country,” Dr Mushimba said.
He said it was prudent that the government reconsider, evaluate and review the procurement processes to help save the nation from total collapse.
“…as a matter of urgency, we ask government to re-look at the structure of our fuel procurement. As they do that, we have a proposal for them that they can consider that we have modelled and found that it saves K8 billion per year, if implemented,” Dr Mushimba said.
“Under this proposed model, with the insertion of a possible national fuel bulk procurement company, a new fuel supply model for the country would look like this: International supplier, Zambia bulk procurement entity, TAZAMA storage infrastructure, national distribution network and retail stations or consumer.”
Dr Mushimba said the current fuel supply chain was problematic and had contributed to the ever-increasing fuel prices in the country.
“The current procurement process is transporter, dealer plus dealer margin and retail stations to consumer. If we want cheaper fuel, before government even considers subsidies, government must restructure how we procure fuel,” he said.
