Africa-Press – Zambia. The Zambia Federation of Employers (ZFE) has called on government to put modalities that will bring down the cost of production for businesses in the country.
Speaking to the media in Kitwe yesterday, Federation of employers’ president Evans Chibanda said the escalating cost of production is a threat to existing jobs as employers may opt for job cuts to sustain their operations.
Mr. Chibanda cited the factors of production such as fuel and the unstable Kwacha as some of the urgent essentials that should be addressed as soon as possible.
Mr. Chibanda wondered if government has removed the middlemen in the fuel value chain because the commodity has remained high and triggered the cost of production.
“The cost of fuel which is being reviewed every month is an overhead to business companies which means it will also push up operational costs and make it difficult to pay salaries and as a result some companies may opt to declare some jobs redundant to sustain their businesses and we do not want that,” he said.
He said government should find a way of stabilizing the cost of fuel despite the fact that the escalating prices of fuel are caused by external factors.
And Mr. Chibanda has described the first quarter of 2022 as being unfavourable to most of the employers across the industry due to continuously increasing cost of production caused mainly by the unstable Kwacha, escalating fuel prices and the effects of COVID-19 among other factors.
He noted that if nothing is done to arrest the situation, most companies will close up. The high cost of production has for a long time been a problem among businesses in Zambia and little has been done by past governments to address the issue despite cries from the business community.
Yesterday, the Energy Regulation Board (ERB) has announced the upwards adjustment of the pump prices of all petroleum products effective midnight of Thursday, March 31, 2022.
ERB Board chairperson Reynolds Bowa said that the board has adjusted upwards Pump prices of petroleum products by K4.54 per liter for petrol, K3.93 per liter for kerosene and K4.68 per liter for diesel
Mr Bowa stated that the increase in the pump prices has been necessitated due to the continued strain in the global oil supply mainly due to the geopolitical conflict between Russia and Ukraine.
He added that the war between Russia and Ukraine has exerted additional pressure on the already escalating oil prices on the international market. Mr Bowa noted that prices of finished products on the international markets have gone up steeply and continue to trade above 130 United States dollars per barrel.
“And on the domestic market, the impact would have been more adverse had it not been for the resilience and marginal appreciation of the Kwacha against the dollar during the period under review,” he stated.
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