Mercedes Sayagues
An 800m-long queue curls around a petrol station in downtown Harare. Elsewhere, queues cause car accidents and fights. Angry drivers are frantic for diesel – Zimbabwe staggers with barely a one-day supply left and erratic deliveries.
Far worse than the woes of the 4×4 crowd is the problem for commuter buses and factories. Reopening last Monday after the Christmas break, industry cannot get enough diesel to keep it going.
The fuel shortage is five weeks old. The National Oil Company of Zimbabwe (Noczim), the parastatal oil procurement agency racked by corruption, mismanagement and a Z$9-billion debt, doesn’t have enough forex or credit to bring in fuel.
“This shortage shows our government’s incompetence. If you can’t manage fuel supply, you can’t manage the economy,” says trade union leader Morgan Tvsangirai.
The government can’t manage the power supply either. The Zimbabwe Electricity Supply Authority (Zesa), the parastatal power utility, cannot meet its Z$3-billion power import bill from Mozambique’s Cahora Bassa, the Democratic Republic of Congo and South Africa’s Eskom, but Eskom’s generous credit facility has bailed out Zesa. South African generators, sending 3 920 megawatts per hour, keep Zimbabwe alight.
While the economy crumbles, the country is preparing for parliamentary elections in March. Sometime before then, a referendum should be held on the much-publicised new Constitution, drafted by the ruling party, Zanu-PF.
But a United Nations electoral supervision team invited by the government has found gross irregularities in the voters’ roll. In some wards, up to one-quarter of the voters on the roll were dead or had moved.
This begets the million-dollar question: will elections be held in March or later? It is in the interest of Zanu-PF to hold elections before the bottom falls out of the economy.
Diplomatic sources say two key ministers, Dumiso Dabengwa of home affairs and Emmerson Mnangagwa of legal affairs, see the need to postpone until mid-year. In this scenario, however, the government would not be able to hold on to current unrealistic fuel prices and exchange rates. At Z$38 for each US dollar, the Zimbabwean dollar is overvalued. It is actually trading at Z$42 and economists reckon its true value is closer to Z$45 or Z$50. The same goes for petrol, priced at Z$18 a litre, slightly less for diesel.
But floating both would fuel inflation, already at an unpalatable yearly average in 1999 of 58,5%, with a record peak of 70% in October. Some economists reckon the move could trigger hyperinflation. Others disagree.
Whatever the outcome, the hikes would bring more hardship for Zimbabweans.
The Central Statistical Office estimates that 76% of Zimbabwe’ s 12,5-million population live in poverty. While at least one-quarter of the population is infected with HIV/Aids, the cost of medical care nearly doubled last year. Unemployment is over 50% and interest rates are over 60%.
To raise his flagging popularity, President Robert Mugabe recently awarded a 90% hike to civil servants and the military. His ministers and himself got a whopping 200% hike, backdated to July last year. Chiefs and headmen also got hefty allowance increases. Mugabe’s generosity will raise the wage bill to Z$11-billion. It is not known where the money will come from, since this year’s budget foresaw only a 25% salary increase.
This week, fearing Zimbabwe’s forex shortage, South Africa’s First National Bank suspended trade support lines, while last week, the United Kingdom’s Export Credit Guarantee Department said that Zimbabwe has stopped repayments and owes it 700 000. “The prospects are fairly dire,” says economist Tony Hawkins.
The economic debacle – dubbed as the worst ever in the country’s history – could translate into a vote against the government in the constitutional referendum and the parliamentary elections. However, the ability of Zanu-PF to hang on to power and to divide the opposition by any means should not be underestimated.