Maravi

'Govt to blamfor fuel crisis'

'Govt to blamfor fuel crisis'
By Florence Bupe
Wednesday October 10, 2007 [12:00]

The current fuel shortage has been caused by the government’s change of fuel procurement systems, a senior government source has disclosed. And an energy consultant, Andrew Kamanga has advised the government to get the private sector more involved in the procurement of feedstock as a way of preventing frequent fuel crises.

Meanwhile, the Zambia Association of Chambers of Commerce an Industry (ZACCI) has said the prevailing fuel shortage will adversely affect Zambia’s economy, which has been recording positive growth over the last few years. The senior government source, who sought anonymity, said the fuel problem was largely due to government’s shift in the procurement system of feedstock.

“Indeni has purely nothing to do with what’s happening. Government has changed the procurement system of feedstock, and that system has made the business community lose confidence in the process,” the source said.

The source disclosed that the last consignment of feedstock that arrived at the Port of Dar-es-Salaam on September 20 had not been released because the government still owed demurrage fees.

“For each day that the ship stays at the por t, it costs about US $20,000. Now imagine how much is owed since the ship docked on 20th September,” the source said.“ It raises a lot on questions on how we are handling this issue of critical importance.”

And Kamanga has said there is need for government to allow the private sector to participate more in the procurement of feedstock.

“If government is having difficulties in the procurement of feedstock, why not get the private sector on board?” Kamanga asked. “At the moment, the rules are that only government can procure the feedstock.

The solution to the existing fuel crisis lies in the private sector managing that side of the business.”

Kamanga said the private sector had more financial strength and capability to manage the acquisition of the feedstock.

“The minister’s (Konga) explanation on what has delayed the pumping of feedstock is purely operational. It is clear that government is not honouring its part of the contract with suppliers,” Kamanga said. “Let someone with greater capability and financial muscle handle this process.”

Last Friday, Konga issued a statement that the fuel shortage was due to the delay by the government to raise a letter of credit to the supplier of feedstock. He said the government’s continued involvement in the procurement process was likely to result in further fuel crises. He said the government needs to have confidence in the private sector as partners in the development of the energy industry.

Konga has said the current procurement system has been in effect for a long time. “Government has not changed any system, what system are you talking about?” Konga asked. “We are still using the old procurement system.”

On the accumulation of demurrage fees, Konga said it was not the government’s responsibility to settle the fees. “That is not our ship. Our business is simply to order the feedstock, and that is what we have done. It is up to the supplier to ensure that those fees are paid,” he said.

As at Sunday, Konga was unsure of when Indeni would resume normal operations. “We are still waiting for information regarding when Indeni will resume the pumping of fuel. The ministry (of energy) will issue a comprehensive statement tomorrow (Monday),” said Konga.

Also commenting on the fuel situation ZACCI chief executive officer Justin Chisulo said in an interview that Zambia’s production levels would greatly decline as a result of the fuel crisis.

“Any fuel shortage in any country affects the business sector in various ways. There are a lot of industries that rely on fuel for actual production and when there is a erratic supply of fuel as is the case now, industries are unable to produce as desired,” he said.

Chisulo said the country was not only losing out in terms of actual production, but that a lot of human resource was not performing at full capacity.

Labels: FUEL, ZACCI

posted by MrK @ 8:10 PM