ECONOMY-ZIMBABWE: Running on Empty

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Sekai Ngara

HARARE, Jul 29 2005 (IPS) - The sight of cars caked with dust, lined up outside filling stations, has become a common one in Zimbabwe. Some of the vehicles have been there for days, even weeks, as motorists grapple with what many view as the worst episode yet in the country’s recurrent fuel crisis.

When Zimbabwe’s petrol stations started running dry a few days after the Mar. 31 general election, car owners at first thought it was part of the "on again, off again" cycle that has characterized the fuel supply since late 1999.

But, almost four months later, the situation has not improved – and indications are that what many refer to as the "fuel blues" may be with Zimbabweans for a while yet.

In the first throes of the latest fuel shortages, people like John Mbedzi spent the night in their cars, hoping supplies would arrive.

"I spent three nights in a row in my car guarding it, waiting for fuel that did not come. Now, I’ve decided to park the car at home until the situation normalizes," he says. Others simply abandon their vehicles in queues, presumably to return when petrol or diesel becomes available.

But, when a filling station does receive fuel, even first place in the queue is no guarantee of a full tank. Thanks to the popularity of mobile phones, word gets around so quickly that the whole city often appears to descend on the station in question. Scenes of near riots and fisticuffs have been reported as people struggle to buy fuel; on occasion, the police have been called to restore order.

"Sometimes queues snake about for almost four kilometres," says filling station attendant Tawanda Banda. Those unlucky enough to be at the tail end stand little chance of buying petrol or diesel, but grimly maintain their places nonetheless.

After the relatively normal fuel supply in the months leading up to elections, the latest, abrupt shortages took many Zimbabweans by surprise. Others believed government had simply broken the bank to appease voters ahead of the poll. "Now we are paying the price," said economist Tony Hawkins.

Officials themselves have remained largely silent about the shortages, although Energy Minister Michael Nyambuya eventually admitted the flow of petroleum products into the country had been reduced to a trickle because of foreign currency shortages.

"The country’s fuel bill has doubled because the price of crude has doubled from 27 U.S. dollars to 60 U.S. dollars in the past twelve months," he said.

In a bid to defuse the crisis, government last week relaxed import regulations on fuel, to allow individuals to import petrol and diesel from neighboring countries for their own use or for sale, if they had the funds.

But, while private importers are supposed to sell any supplies they bring in at the official price, not too many are heeding this instruction. Petrol is changing hands at as much as ten times the pump price of about 60 U.S. cents per litre.

Reserve Bank governor Gideon Gono has also said that government will allow those with U.S. dollars to use them to buy fuel at designated filling stations, perhaps a tacit admission that Harare’s ‘Homelink’ scheme was not living up to expectations.

Under the initiative, a favourable exchange rate is offered to Zimbabweans working abroad to encourage repatriation of their earnings through official channels. As the rate is about half what the black market is offering, however, few people have made use of the facility (the so-called "diaspora rate" is currently pegged at 17,500 Zimbabwe dollars to one U.S. dollar).

The dismissal of Homelink notwithstanding, Gono’s proposal was greeted with suspicion by Zimbabweans, with some seeing it as a trap for people who are flouting exchange regulations. "I would not go anywhere near such a filling station even if I had the U.S. dollar," said one of the sceptics, Mercy Moyo. "What will stop them (officials) from noting my car number and asking me to tell them where I got the money from?"

Energy Minister Nyambuya has said the shortages are worsened by black marketers who are buying what little fuel is in the country, to sell it at inflated prices. He also complained that fuel was being smuggled to other states from Zimbabwe, as the country had the cheapest supplies in the region.

Such claims have been used by government to defend its recent campaign against informal settlements in urban areas: the much maligned Operation Restore Order. Officials claimed the targeted settlements were being used for black market trading in scarce commodities, such as petrol and diesel.

However, the executive director of the United Nations Human Settlements Programme, Anna Tibaijuka, has condemned the campaign after investigating its consequences at the request of U.N. Secretary-General Kofi Annan.

Following a two-week visit to Zimbabwe, Tibaijuka issued a report earlier this month which stated that "Operation Restore Order, while purporting to…clamp down on alleged illicit activities, was carried out in an indiscriminate and unjustified manner, with indifference to human suffering…"

According to the report, about 700,000 people are believed to have lost their homes, or source of income, or both in the campaign. And, while some fuel has been seized during the demolition of informal settlements, the shortages continue.

Minibus operators who augment the almost non-existent public transport system are charging more than government-set fares, pointing to the fact that they source fuel at black market prices.

The hours people spend in fuel queues and waiting for transport to get to and from work are also taking their toll on production.

"I get people reporting for work at lunch time and there is little I can do about it," the owner of a panel beating shop told IPS. "I had to use a taxi to get to work myself for some time as I could not get fuel."

For the past five years, Zimbabwe has been gripped by an economic crisis, ascribed by certain analysts to the country’s controversial farm seizure programme, and its costly involvement in the Congolese civil war – amongst other factors.

It has also suffered political turmoil: violence and allegations of vote rigging have marred Zimbabwe’s last three elections.