Fuel prices in Zimbabwe have skyrocketed by up to 200% in the last fortnight amid fresh shortages brought on by inflation and a devalued currency, analysts said on Monday.
The rise in fuel prices, attributed by industry players to the high cost of foreign currency needed to finance its importation, has triggered a wave of increases in bus fares and commodities across the country.
The increasing economic meltdown in Zimbabwe, with inflation now standing at over 1 700% and four out of five people unemployed, has helped fan the growing unrest towards veteran President Robert Mugabe.
While fuel prices in the Southern African country rise constantly under an ever-increasing inflation rate, analysts say this rise was nevertheless exceptional.
“This is one of the highest increases we have had in a long time and it’s a phenomenal rise,” said Witness Chinyama, a Harare-based economist.
Urban and long-distance transporters have hiked their fares by at least 150%, and petrol is now sold at garages for Z$13 000 (US$52) compared with Z$2 000 dollars in January.
Diesel now costs Z$15 000 dollars a litre.
“There is a need to review the exchange rate in line with inflation,” said Chinyama.
“We are now one of the most expensive countries and our export competitiveness is now being impaired by this artificial exchange rate.”
Since August last year, authorities have pegged the local unit at Z$250 to US$1, yet in reality it costs about Z$14 000.
Although the official price of petrol and diesel is pegged at Z$335 and Z$320 respectively, no service station is selling at that price as it is not viable.
“We cannot sell petrol at the government price because it is not economically viable,” one fuel dealer said, refusing to be named.
The government last reviewed fuel prices last year.
Zimbabwe has faced serious fuel shortages since 1999, which the government blames on sanctions imposed on President Robert Mugabe and members of his inner circle at the time.
When the shortages are at their worst some gas stations go without fuel for months, forcing buses and private cars off the road and leaving many commuters no option but to walk or cycle to their workplaces. — AFP