Zim faces fuel shortage

HARARE - There are growing fears that the country could slip back to the 2008 hyperinflationary era dominated by fuel and food shortages following the re-emergence of long queues at most garages this week as a result of biting foreign currency shortages.

This "coincided" with the rise in prices of both petrol and diesel at most service stations.

However, the Reserve Bank of Zimbabwe (RBZ) insists there is no need to panic as the country is holding enough stocks to supply the market.

Most service stations struggled to keep up with demand from customers anxious to fill tanks as foreign currency shortages intensify, with some locations running out of supplies this week.

Price of petrol breached the $1,35/ litre mark in Harare yesterday.

A snap survey carried out by the Daily News showed that some fuel stations did not have petrol at all.

Along the Harare-Bulawayo highway, petrol retailed at between $1,39 and $1,42.

Retailers told the Daily News yesterday that they are failing to access their weekly foreign currency allocations from the RBZ due to a critical dollar shortage.

In terms of the arrangement imposed by the RBZ, oil companies approach their banks and request that payment of a certain amount be made to a company that they will be dealing with on the basis of their nostro accounts.

Nostro accounts are accounts that a bank holds in foreign currency in another bank.

Following the request, the bank would accept the request, with approval from RBZ. However, there have been challenges of foreign currency, despite the tradition that the RBZ prioritises energy and fuel in allocation of hard currency.

Payments for critical inputs for the productive sector are given top priority on the list but fuel dealers said they were being forced to buy expensive foreign currency on the parallel market to pay for supplies outside normal banking channels because of inordinate delays to have their payments processed.

This comes as the central bank is sitting on applications for payments, with some going beyond an unsustainable 180 days, with manufacturing companies complaining that they were incurring huge penalties because of late payments.

Most fuel suppliers get the commodity outside the country, where they pay cash upfront in United States dollars, but have been failing to do so.

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