In a progressive step toward embracing electric mobility, Zambia has proposed removing customs duties on electric vehicles (EVs) and charging infrastructure. This proposal aligns with the government's goal to promote sustainable energy and reduce dependence on fossil fuels. The move announced as part of the 2024 national budget, is expected to accelerate EV adoption in the country.
Key Announcements
Zambia's Finance Minister, Dr. Situmbeko Musokotwane, highlighted the removal of customs duties for various electric vehicles, including motorcycles, cars, buses, and trucks, as well as charging systems. Additionally, excise duties on hybrid vehicles will be reduced from 30% to 25%. These changes aim to make electric vehicles more affordable and accessible to a broader population.
Boost to Electric Vehicle Adoption
Removing customs duties is a critical step in reducing the cost of electric vehicles, which have higher upfront prices than traditional internal combustion engine (ICE) vehicles. Despite the long-term financial and environmental benefits of EVs, the initial cost has been a major obstacle to broad acceptance. This measure is expected to make EVs more competitive with traditional cars, encouraging more citizens and businesses to make the switch.
The Role of ZEMIA
The Zambian Electric Mobility and Innovation Alliance (ZEMIA), a Non-commercial group, played a leading role in pushing for these incentives. ZEMIA has long advocated for policies that encourage the adoption of electric mobility, recognizing the significant environmental and economic benefits. The organization praised the government's decision but also emphasized the need for additional incentives to fully support the EV transition.
Additional Recommendations by ZEMIA
While the removal of customs duties is a positive step, ZEMIA has proposed further measures to ensure the successful adoption of electric vehicles in Zambia. These include:
- Exempting or reducing VAT and import duties on electric vehicles and related components.
- Implementing dedicated electricity rates for charging electric vehicles.
- Providing Business tax benefits for companies in the Electric Vehicle sector.
- Exempting electric vehicles from vehicle tax and tolls for a designated period.
- Developing infrastructure, such as quick-charging stations, to support the growing number of Battery-powered vehicles.
Environmental and Economic Impact
The removal of customs duties aligns with Zambia's clean energy goals. The country’s electricity generation is predominantly hydro-powered, providing a renewable and low-cost energy source for electric vehicles. As petrol and diesel costs continue to rise, the economic case for EVs strengthens. The proposal will also contribute to lowering greenhouse gas emissions, enhancing air quality, and advancing public health.
Zambia’s Growing Role in Africa’s EV Landscape
Zambia's government is positioning the country as a leader in electric mobility in Africa. President Hakainde Hichilema's recent discussions with BYD and CATL, major players in the EV and energy storage industries, signal the government’s commitment to fostering innovation and investment in green technologies. Zambia's proposal to remove customs duties on electric vehicles puts it alongside other African nations, such as Ethiopia and Rwanda, that have taken similar steps to promote sustainable transportation.
Conclusion
Zambia’s proposal to remove customs duties on electric vehicles and charging infrastructure is a pivotal move toward sustainable transport. With support from organizations like ZEMIA and additional incentives, the country is on track to become a leader in Africa’s green energy transition. These changes will not only make EVs more affordable but also reduce the environmental impact of transportation, benefiting both the economy and the environment.
