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Proposed electricity tariff hike will affect manufacturing sector – ZAM

• The proposed increase of electricity tariffs by Zesco will be another add-on to the challenges which the sector is already grappling with.
• Increasing the cost of electricity will trigger a rise in the cost of production.
• This will also increase the cost of living

Zambia Association of Manufacturers (ZAM) says the proposed increase of electricity tariffs by Zesco will be another add-on to the challenges which the sector is already grappling with.
Speaking in an interview with Money FM News, Association Chief Executive Officer Muntanga Lindunda said increasing the cost of electricity will trigger a rise in the cost of production.
Ms. Lindunda stated that the move will have a negative effect on the manufacturing industry as it largely depends on electricity for operations.
She added that this will also increase the cost of living further as manufacturers will opt to pass on some of their burdens to end users of their products which are consumers.
“ZAM is aware of the proposed upward adjustment of electricity tariffs. This was after ERB’s approval to ZESCO’s application to adjust upwards of electricity tariffs based on the following reasons that where shared and one of the reasons is the current unsustainable trajectory of ZESCO Limited’s financial challenges, including its debt situation,” she said.
Meanwhile, Ms. Lindunda added that the upward adjustment of fuel prices will as well affect the production of the manufacturers.
“Some manufacturers rely on diesel generator to keep them running when there is no electricity hence the upward adjustment of fuel will negatively affect them,” she added.

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