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Letter from Africa: Despair, anger and anxiety in Zimbabwe's fuel queues

BY: bbc.com
Motorists have had to queue for hours to get fuel
Motorists have had to queue for hours to get fuel

In our series of letters from African writers the journalist and lawyer Brian Hungwe reflects on the impact of inflation on the lives of Zimbabweans, where the price of fuel has more than doubled in an effort to deal with a shortage.

I joined a queue for petrol at around 16:00 on Saturday afternoon.

Dozens of cars made an orderly line stretching about 500m.

The pace of the service was so excruciatingly slow that most of us made friends in an effort to keep boredom at bay.

Anger over price rise

By the time I got to within 100m to the petrol pump - about five cars ahead of me - it was an hour before midnight, but the fuel attendants suddenly shut the pumps, packed up their bags and left.

You can imagine the murmurs of despair, anger, and anxiety.

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News had filtered in that President Emmerson Mnangagwa had put up the price of fuel by more than 100% to take effect at midnight.

Those lucky enough to have bought their fuel before us could only thank the heavens.

The reason for the hike, the government said, was to avert fuel shortages that have created national angst.

The hike means petrol prices rose from $1.24 (£0.97) a litre to $3.31 , with diesel up from $1.36 a litre to $3.11.

Zimbabweans were not pleased by these changes, hundreds of them went to the streets of the capital, Harare and the southern city of Bulawayo, to protest against the new prices.

The sudden increase is symptomatic of price distortions Zimbabweans have to deal with on a daily basis.

The price of fuel is fixed by the authorities. Unlike other businesses, fuel stations have to sell petrol at the same price in US dollars and the surrogate currency - bond notes - introduced more than two years ago to address a cash crisis.

Protesters in Harare and Bulawayo blocked roads and lit fires to express their anger over the new fuel prices

Thriving black market

The government maintains that bond notes, which is only traded in Zimbabwe, is pegged to the US dollar.

But the reality of the ground is different.

There is a thriving black market where three bond notes fetch one US dollar.

The current situation reminds everyone of the pre-2009 era when inflation went into the stratosphere - reaching 231m% in six months before the Zimbabwe dollar was abandoned for international currencies like the US dollar and the South African rand.

You have to walk into a supermarket to see the price distortions at work.

If I pick groceries worth $20 I will be given a choice of how to pay for the items. I could opt to use bond notes, but the bill will be 60 bond notes.

Or I could pay electronically with my card - and 70 bond notes would be deducted from my account as each electronic transaction is now subject to tax.

Doctors and other civil servants, whose salaries are paid in bond notes, are angry - and some even went on strike to demand that they get paid in dollars as their salaries cannot keep up with the inflation.

There are many businesses which are only accepting payment in US dollars - including private schools.

If doctors were to get their wish they would have to open up a separate foreign exchange account.

This is because ordinary bank accounts no longer handle US dollars.

Three years back, one could withdraw as much as $2,500 from a cash machine. Now they only supply bond notes - and each account holder can only withdraw 20 bond notes a day.

Queues outside banks are therefore a common sight as Zimbabweans use other ingenious ways to get access to their money.

The government also tries as much as it can to get its hand on foreign currency, expatriates and tourists for example are required to pay for goods and services using US dollars.

Other lucky Zimbabweans get money sent by relatives overseas to help them navigate the economic challenges.

 Three years back, one could withdraw as much as $2,500 from a cash machine. Now they only supply bond notes - and each account holder can only withdraw 20 bond notes a day.  Queues outside banks are therefore a common sight as Zimbabweans use other ingenious ways to get access to their money.  The government also tries as much as it can to get its hand on foreign currency, expatriates and tourists for example are required to pay for goods and services using US dollars.  Other lucky Zimbabweans get money sent by relatives overseas to help them navigate the economic challenges.  Image copyrightREUTERS Image caption Long queues have been a common sight outside banks in Zimbabwe Consequently, Zimbabweans have not taken to the bond notes.  The currency is being blamed for the inflation crisis and the price distortions that have become a headache for consumers and industry alike.  But these distortions were predictable.  If you talk to economists, they will tell you something about Gresham's law, which occurs when two different currencies are given the same value.  Cash under the mattress The principal is "bad money drives out good", in other words, one currency will become more desired than the other.  In the case of Zimbabwe and the US dollar, the desired currency disappeared as many withdrew their US dollar cash from the bank, and kept the notes under their mattresses. Most banks ran out of it, worsening a biting cash crisis.  Just after the military intervention that ousted President Robert Mugabe in November 2017 Zimbabweans were obsessed by debates around economic reforms.  Suddenly everyone became an economist.  But the investment has not come flooding in as was expected. Investors may still be spooked by the nature of the military's hand in the government.  Image copyrightAFP Image caption Zimbabwean President Emmerson Mnangagwa has been struggling to revive the county's economy The euphoria that ushered in President Emmerson Mnangagwa, or ED - as he is affectionately known - has ebbed and he is now walking a tightrope.  Finance Minister Mthuli Ncube says he wants to reintroduce the Zimbabwean dollar by the end of this year.  Experts say this would allow the central bank to control inflation more effectively and it will be good for the economy.  "The current dollarised scenario where we are having to import foreign currency for local use is unsustainable as current foreign exchange generation is not enough to meet the country's import demands," economic analyst Persistence Gwanyanya told the state-run Herald newspaper.  But frustration is growing daily, with many Zimbabweans fed up that the post-Robert Mugabe era is not living up to the high expectations.  More Letters from Africa Africa in 2019: Beyoncé, Bashir and Big Brother Africa's history makers in 2018 Why people keep cash under the mattress in Sudan A royal visit to a land of princes A young country for old men I was tortured in The Gambia Kenya's Bible plan to tackle corruption Follow us on Twitter @BBCAfrica, on Facebook at BBC Africa or on Instagram at bbcafrica  Related Topics Emmerson MnangagwaZimbabwe Share this story About sharing Email Facebook Messenger Twitter Pinterest LinkedIn More on this story Zimbabwe's scaled-back Christmas celebrations 25 December 2018 Zimbabwe currency crisis: No cash, no bread, no KFC 12 October 2018 Zimbabwe country profile 14 January 2019 Around the BBC Africa Today podcasts Africa ICC orders release of ex-Ivory Coast leader 15 January 2019  From the section Africa Full article ICC orders release of ex-Ivory Coast leader LIVE Africa Live: Opposition headquarters torched in Zimbabwe From the section Africa Full article Africa Live: Opposition headquarters torched in Zimbabwe Zimbabwe fuel price protests turn deadly 14 January 2019  From the section Africa Full article Zimbabwe fuel price protests turn deadly More Videos from the BBC 'Why I had to leave my ultra-Orthodox life' Trump serves fast food to White House guests Facing jail for wearing a dress VR shoes: 'I feel totally knackered' The front door that parcel thieves hate The 18-year-old chimney sweep Recommended by Outbrain Elsewhere on BBC BBC News Maroon 5 to perform Super Bowl despite controversy BBC News Python with 500 ticks found in pool BBC News Family had to sit on floor of plane Recommended by Outbrain You Might Also Like BBC Culture Is the era of the movie star over? 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Consequently, Zimbabweans have not taken to the bond notes.

The currency is being blamed for the inflation crisis and the price distortions that have become a headache for consumers and industry alike.

But these distortions were predictable.

If you talk to economists, they will tell you something about Gresham's law, which occurs when two different currencies are given the same value.

Cash under the mattress

The principal is "bad money drives out good", in other words, one currency will become more desired than the other.

In the case of Zimbabwe and the US dollar, the desired currency disappeared as many withdrew their US dollar cash from the bank, and kept the notes under their mattresses. Most banks ran out of it, worsening a biting cash crisis.

Just after the military intervention that ousted President Robert Mugabe in November 2017 Zimbabweans were obsessed by debates around economic reforms.

Suddenly everyone became an economist.

But the investment has not come flooding in as was expected. Investors may still be spooked by the nature of the military's hand in the government.

The euphoria that ushered in President Emmerson Mnangagwa, or ED - as he is affectionately known - has ebbed and he is now walking a tightrope.

Finance Minister Mthuli Ncube says he wants to reintroduce the Zimbabwean dollar by the end of this year.

Long queues have been a common sight outside banks in Zimbabwe

Experts say this would allow the central bank to control inflation more effectively and it will be good for the economy.

"The current dollarised scenario where we are having to import foreign currency for local use is unsustainable as current foreign exchange generation is not enough to meet the country's import demands," economic analyst Persistence Gwanyanya told the state-run Herald newspaper.

But frustration is growing daily, with many Zimbabweans fed up that the post-Robert Mugabe era is not living up to the high expectations.