Zimbabwe’s President Hikes Fuel Prices To Tackle Shortages

Zimbabwe’s President Emmerson Mnangagwa has announced a sharp
increase in fuel prices in a measure to improve supplies as the
country struggles with its worst petrol shortages in a decade.

After years in international isolation, Zimbabwe’s economy has
been on a downturn for more than a decade with cash shortages, high
unemployment and recently a scarcity of basic staples like bread
and cooking oil.

In an address on state television late Saturday, Mnangagwa said
prices of petrol and diesel would more than double to tackle a
shortfall caused by increased fuel usage and illegal trading.

Mnangagwa, who took over from long-time leader Robert Mugabe and
won a disputed election in July, also announced a package of
measures to help state workers after strikes by doctors and
teachers over pay.

He said from midnight petrol prices would rise to $3.31 (2.89
euros) from $1.24 a liter and diesel prices to $3.11 from $1.36 a
liter.

“Following the persistent shortfall in the fuel market
attributable to increased fuel usage in the economy, and compounded
by rampant illegal currency and fuel trading activities, the
government has today decided on the following corrective measures,”
he said announcing the changes.

The finance minister this week said the prices were lower than
other countries in the region and some foreigners were taking
advantage of buying fuel in bulk in Zimbabwe for resale in
neighbouring countries.

The announcement came after fuel shortages which began in
October last year worsened in recent weeks with motorists sometimes
spending nights in queues at fuel pumps stretching for
kilometers.

Mnangagwa said foreign diplomats and tourists would get fuel at
cheaper prices at certain designated points. The government also
introduced measures to curb a parallel market where fuel was being
sold at five times the official price.

Doctors in state hospital went on a 40-day strike beginning
early December demanding salaries in US dollars and improved work
conditions.

Teachers unions also called a strike this week for better pay,
though their calls went largely unheeded.

Mnangagwa also warned against “certain elements bent on taking
advantage of the current fuel shortages to cause and sponsor unrest
and instability” in the country.

As part of financial reforms, Zimbabwe also plans to
re-introduce a local currency “in less than 12 months”, after using
the US dollar and regional currencies since its hyperinflation
crisis a decade ago.

AFP