Cost Reflective Tariffs to increase cost of doing business- Dodia

PSDA Chairperson Yusuf Dodia

The Private Sector Development Association (PSDA) has charged that the implementation of cost reflective tariffs will mean that the inefficiencies in Zesco will be paid for by the consumers.

PSDA chairperson Yusuf Dodia says this will also make the cost of doing business in Zambia more expensive.

Mr. Dodia says the challenge in Zambia about cost reflective tariffs is that the country is looking at a mechanism that supposes that everybody can afford to pay more for electricity without looking at the impact on the manufacturing sector.

He explains that by migrating to cost reflective tariffs, it means that Zambia will no longer be competitive with other countries in the region adding that cost reflective tariffs do not promote growth of the economy.

Mr. Dodia further points out that evidence shows that countries that have tried cost reflective tariffs, most of which are European countries have become countries where it is too expensive to do manufacturing in those countries.