Fri, 11 Aug 2017 10:48:42 +0000
Dear Editor,
The Energy Regulation Board (ERB) reduced the fuel pump price on Monday August 7, 2017 and the reduction became effective at midnight.
ERB board chairperson Raymond Mpundu announced that the price of diesel has been reduced from K10.72 to K9.87 per litre representing 7.93 percent reduction, petrol has dropped from K12.50 to K11.67 per litre which represents a reduction of 6.64 percent and kerosene has dropped from K6.81 to K6.50 per litre translating into 4.55 percent reduction.
However, the reduction in the pump price of fuel has been exacerbated by appreciation of the Kwacha, excess fuel stock and an increase in the price of copper on the London Metal Exchange.
Copper is trading between US $6,300.00 and US$6,500.00. Mining firms convert foreign currency to kwacha in order to meet their tax obligations.
Fuel is one of the components which drives the national economy. Any adjustment in the pump price of fuel affect the price of goods and services in the country.
If the price of fuel goes up, this leads to a corresponding increase in the price of goods and services and the opposite holds true.
In view of the aforegone, the reduction in the fuel pump price should result in the general decrease in the price of goods and services. This will ultimately benefit the consumers. The companies are also bound to benefit as the cost of doing business will be lower than before the price reduction was effected.
All things being equal, the reduction in the pump price of fuel is welcome and this should benefit the final consumers and the business entities.
ELEMIYA PHIRI, Lusaka
