Business

Manufacturers’ normal production falls to 30%, says ZAM

TRYNESS MBALE, Lusaka
THE Zambia Association of Manufacturers (ZAM) says some companies have reduced production to about 30 percent which might result in job losses and cut the sector’s contribution to the treasury.
Zambia is facing an estimated power deficit of 560-megawatts due to poor rainfall in the 2014/15 season that has affected the hydro-electricity generation capacity of Zesco.
ZAM chief executive officer Maybin Nsupila said the current load shedding has adversely affected the manufacturing sector because some firms operate 24 hours and only switch off machines on scheduled maintenance.
Mr Nsupila said in an interview last week that Zesco needs to look for alternative power sources to tackle the current load shedding.
“If you have a situation where power goes off, obviously, you will lose production. We have been affected to the point of losing production. Most companies are producing about 30 percent of their normal production. Given that the fixed cost has also increased, the competitiveness of the products has been adversely affected,” he said.
He said because of the reduced production, some ZAM members have failed to pay their creditors whom they borrowed from to support their production.
He also said the current load shedding has resulted in most companies that supply supermarkets to fall to meet the demand.
“We believe that if Government came up with renewable feeding tariffs, we can unlock investment in the renewable energy subsector. It is the only way we can mitigate the effect going forward. If we continue on this path, we will end up importing more products because a lot of products cannot be produced locally, and this will put increased pressure on the Kwacha which may continue to depreciate,” he said.


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