THE Zambian Government needs to build more oil reserves to reduce its reliance on international oil prices and the US dollar, energy expert Boniface Zulu has said.
Engineer Zulu told The Scoop that this strategy would help stabilize the local market’s oil pump prices and ensure that the country was not overly affected by global economic trends.
He said that having larger oil reserves would also provide a buffer for the country in times of emergencies when global prices were volatile.
He said that the Government needed to also take steps to avoid using the US dollar to buy petroleum products and adopt other currencies.
“The US dollar is prone to fluctuations in the global market which can create a ripple effect on local pricing and cause significant challenges for the local economy. By adopting different currencies for oil purchases, such as the Euro, the Chinese Yuan, or the Japanese Yen, Zambia can reduce its vulnerability to dollar fluctuations,” Engineer Zulu explained.
He emphasized that Zambia needed to shift its focus towards investing in electric mobility and fortifying its economy to combat the negative effects of climate change.
He explained that electric mobility would help reduce the country’s dependence on petroleum products and create new industries that could generate jobs and spur economic growth.
“Building a strong economy would enable Zambia to be more resilient. Creating more oil reserves, implementing different oil-purchasing currencies, shifting attention to sustainable electric mobility, and strengthening the economy, are ways the Zambian Government can build resilience and protect its citizens from economic volatility,” he said.
He said that another challenge that Zambia faced was the frequently conducted monthly oil reviews, which had a negative impact on the local economy as they led to price fluctuations in the local oil market, which could destabilize other economic sectors such as transport.