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ZIMBABWE: Fuel for hard currency off to a slow start
IRIN News
August 03, 2005

http://www.irinnews.org/report.asp?ReportID=48426

The National Oil Company of Zimbabwe (NOCZIM) says it plans to sell fuel for hard currency in cities across the country, despite the poor response to the experiment at the pilot filling station.

Management at Arcadia Filling Station in the capital, Harare, where the sale of fuel at Zim $17,500 (US $1.00) per litre was launched on Tuesday, told IRIN that although they were adequately supplied, motorists were largely ignoring the station, preferring to queue where the price was cheaper at Zim $10,000.

The sale of fuel for foreign currency is aimed at stabilising the price and cushioning the national economy from unforeseen developments in the international oil market.

"The price is US $1.00 and the fuel is readily available. The sales are open to individuals with free funds, Zimbabweans in the diaspora who may wish to buy fuel for relatives and friends, nongovernmental and international organisations," NOCZIM said in a statement.

This facility would be extended to other cities, the parastatal confirmed, and urged motorists to buy coupons from the official foreign currency centres that are to be set up at all participating outlets, which would also sell fuel for South African rands at R6.00 per litre and Botswana pula at P5.00 per litre.

Reserve Bank governor Gideon Gono announced the move last month in an attempt to counter the crippling six-year-old fuel shortage that has adversely affected all sectors of the economy.

According to the Zimbabwe Congress of Trade Unions (ZCTU) over 100,000 workers in the country's transport industry have lost their jobs.

"This [fuel shortage] has affected both formal and informal sectors in the transport industry. Some emerging operators simply cannot afford the high cost of vehicle maintenance and fuel procurement. Companies that used to run large fleets are cutting down, throwing away a lot of workers in the process. The situation will certainly worsen as the fuel shortage worsens," ZCTU chairman, Lovemore Matombo, told IRIN.

Matombo also warned of further jobs losses in the agricultural sector later this year if the fuel situation did not improve by the start of farming season.

Over the last six years Zimbabwe's worsening economic crisis has been characterised by severe shortages of food, forex and basic commodities.

Government efforts to control inflation by restricting the emergence of an informal market in currency and scarce goods have failed to put the country's economy back on track.

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