OMCs OPPOSE IMPORT WAIVER IN ABSENCE OF ADDRESSING CRITICAL PRICING ISSUES

 

By Michael Kaluba

The Oil Marketing Companies Association of Zambia has warned against implementing fuel waivers or subsidies before addressing matters that are critical to fuel price changes such as the price review model and the tendering process, if the move is to yield benefits.

Economist Michelo Maunga has urged government to introduce fuel import waiver in a bid to offset the potential surge in petroleum product prices following the interruption of oil shipment via the red sea by global oil giant, bp due to attacks on its fleet.

However, association president Dr. Kafula Mubanga says government should consider various alternative measures in the long term, bordering on the price review mechanisms and the tendering process to allow for access to cheaper product.

Dr. Mubanga says effecting a waiver or subsidy in the absence of these measures, will not address the challenges in pricing but only complement the existing framework without benefits to the end user.

He adds that the continued weakening kwacha requires the introduction of a waiver to allow different suppliers to source for cheaper product, even with the price having declined from about $89.68 per barrel last month to about $81.28 per barrel this month.

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