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Fuel black market prices explode print friendly version
author/source:Zim Online (SA)
published:Sat 1-Oct-2005
posted on this site:Sat 1-Oct-2005
Article Type : News
Energy minister Mike Nyambuya, who had said the biting fuel shortage would be a thing of the past by last Tuesday, could not be reached for comment
Harare - Prices of petrol and diesel on Zimbabwe’s fuel black-market have shot up to about US$5 per litre as a five-year fuel crisis that worsened in recent months threatens to bring the country to its knees. The illegal black-market has become the only reliable source of fuel for individuals, businesses and even some government departments as only a handful of garages across the country are able to intermittently supply diesel or petrol. But prices on the unregulated parallel market have risen to as much as Z$120 000 per litre of petrol or diesel or about US$4.61 at the official exchange rate of Z$26 000 to one American dollar. Petrol costs Z$22 300 per litre while diesel sells at Z$21 000 per litre on the official market that has however remained dry with some garages saying they have not received a single drop of fuel in the last two months despite promises by government officials including by President Robert Mugabe this week that the shortages will end “soon”. Fewer cars could be seen on Harare’s roads as motorists decided to park their vehicles to conserve on whatever little fuel they may have or because they cannot afford the high prices charged for the commodity on the black-market. “I have got about half a tank of petrol, I am keeping that for emergencies and for any other errand, I will use public transport,” said Joseph Maromo, an account relation manager with a Harare bank.
Zimbabwe’s fuel crisis, which set in after the International Monetary Fund withdrew balance-of-payments support in 1999, is a result of an acute foreign currency shortage that has also seen the country grappling severe shortages of food, electricity, essential medical drugs and other basic commodities because there is no hard cash to pay foreign suppliers. Chaotic government land reforms that destabilised the agricultural sector, the country’s main hard cash spinner, also helped worsen the shortage of foreign currency required to import fuel and other commodities. Energy minister Mike Nyambuya, who had said the biting fuel shortage would be a thing of the past by last Tuesday, could not be reached for comment on the ever-deepening crisis. Main opposition Movement for Democratic Change (MDC) party economics spokesman Tendai Biti said the fuel crisis could see several of Zimbabwe’s weakened industries collapsing. Biti said: "Energy is the centre of any normal functioning business and to go for this long period without reliable sources of energy is just killing business." He added: "This (fuel shortage) is a sign of a failed state. The problem is that we do not have foreign currency because there is no production. Our supply side is crippled, hence this crisis." Zimbabwe’s businesses were already operating at below 50 percent of capacity owing to a variety of problems including hyperinflation, shortage of foreign currency to import machines and spares as well as some raw materials.
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