Party of National Unity (PNU) president Highvie Hamududu says the government’s decision to move 30 per cent cargo from road to rail is sending a bad signal on the regulatory business environment in Zambia.
The government last week brought into effect Statutory Instrument number 7 to regulate the use of road for cargo haulage, but the Chamber of Mines has protested strongly to the decision.
Commenting on the development, Hamududu said in an an interview that the move was not encouraging to investors.
“Statutory instrument no. 7 of 2018 ordering 30 per cent transfer of all goods in transit from road to railway is tantamount to legislating business for Zambia Railways limited, sending a bad signal on the stability and predictability of the business regulatory environment in Zambia which is not good for the growth of our economy at this critical stage. What Zambia Railways needs is a business solution and not a legal one. Government must not hide the inefficiencies and uncompetitiveness of Zambia Railways limited through legal protection. There are better and appropriate business solutions to making Zambia Railways limited competitive with road transport,” Hamududu said
He advised government to partially privatise ZRL in order to attract appropriate capital for the company, instead of looking for financing of Zambia Railways through borrowing.
“Let government consider acceptable methods of revamping Zambia Railways limited that make business and economic sense. For example, partially privatizing it to attract appropriate capital and turnaround for the company, that can create the optimal competitiveness that the road users can buy in. The government must desist from looking for financing of Zambia Railways through borrowing. The country has no space for that and the minister is hunting. This is the same Zambia Railways limited that swallowed the US$120 Euro Bond money, without producing a competitive turnaround,” he observed.
“The issue of big cargo damaging roads is an expired one as toll fees have created compassion for damages on the roads.”
He asked government to reverse the Statutory Instrument.
“I have high regard for the Minister of Transport and communication, Honourable Brian Mushimba, on his professionalism, but he is missing it on this one. His SI no. 7 of 2018 is a missed call. The PF must learn lessons from their past, running an economy through loads of statutory instruments can be very damaging to the economy. Let the government improve its tax administration on the mines and get what is truly due to the treasury and leverage on this revenue to bring about sustainable development,” said Hamududu.
“Zambia is a free market economy and must uphold its tenants, if investment is to flow in the country to grow the economy and create employment. Government must reverse this SI before it creates negative repercussions and send wrong signals about the country policy certainty and predictability. It is important to understand that there is fierce competition for investment in the global economy.”