Harare – Zimbabwe is heading for a gloomy festive season in the wake of a worsening fuel supply situation, ENN reports. Motorists are struggling to secure this scarce commodity as most fuel filling companies in the country are struggling to restock the fuel. This development comes on the back of Zimbabwe Energy Regulatory Authority’s fuel price increases on Monday, citing Free on Board price movements and the revised duty regime. A litre of blend petrol (E20) is now retailing at $17.07 while diesel will sell at $17.74 per litre. Last week, the price of petrol was pegged at $16.77 while diesel was at $17.53 per litre.
With unending fuel and electricity shortages, Zimbabwean industries have been standing on one foot for long, juggling against foreign currency challenges which are threatening to halt their operations. Government’s policy interventions are failing to address the country’s cash crisis, opening avenues for arbitrage opportunities by highly political figures and currency speculators. In Zimbabwe, cash is sold at a premium against real time gross settlement (RTGS) values. These RTGS values come in the form of bank transfers and mobile money transfers. As the few remaining formal workers in Zimbabwe struggle to make ends meet, informal traders have dollarized their services to hedge against exchange rate losses. ENN Zimbabwe Correspondent Carol Mvundura visited Mbare Musika, a ZWL$1 billion green market in Harare and noted that most farmers are selling their produce in United States dollars. In the case of local currency, they were only accepting hard cash, which is still in short supply. Last week, the Reserve bank of Zimbabwe injected new bank notes and coins into the market, but there has not been any noticeable improvement in cash availability.
The recently announced Zimbabwe national budget failed to lift hope amongst Zimbabweans as it continues to touch on everything with focus on nothing. A more conceptual approach to addressing Zimbabwe’s economy is required; one that is premised on capacitating the primary sectors of the economy for a value chain impact that will benefit everyone. Agriculture remains Zimbabwe’s hope for economic recovery, yet the inconclusive land tenure issues continue to raise pessimism amongst farmers and investors considering that investing in agriculture is a long term game.
As the festive season begins, Zimbabweans are plunging into their worst festive season in a decade. Most Zimbabweans look set to spend the festive season hungry and at home, with urban dwellers unintentionally deserting their rural folks. Disposable incomes are at their lowest and basic costs of goods are at their highest, driven by the evil triplets of fuel availability and fuel cost challenges, electricity availability and electricity cost challenges and lastly, foreign currency availability and foreign currency cost challenges. During the festive season, demand for fuel looks set to increase without a corresponding increase in supplies. It’s nolonger a far-fetched assertion that most companies will fail to reopen for business in January 2020 due to viability challenges as school drop outs look set to increase as a result of financial challenges on the part of parents.