The Minister of Energy and power Joram Gumbo expressed optimism about the improvement in the countries fuel situation after announcing that US$50m worth of Lines of credit had been made available to fuel suppliers. This, in his opinion, would ease fuel shortages that have gripped the nation for nearly 2 months now in spite of the government recently releasing strategic fuel reserves to also alleviate shortages.
The Herald reports the situation had started to show signs of improvement with many fuel stations starting to receive supplies but in earnest, it is way to soon to tell. We’ve seen the improvement of supplies and the disappearance of queues in the short term before only to be hit by shortages again within a week. The questions around the pricing of fuel also threaten the stability of supplies in the country.
Consumption of fuel in Zimbabwe is reportedly on the decline. The usage figures for Petrol were down from 4.5million to 3 million litres per day. Diesel consumption also declined drastically from 3.8million litres to 2 million litres per day. While this may seem a reason for celebration because of reduced demand it is important to note that no alternatives have been offered up to replace the demand from previous. This with the reports of a marked decline in retail demand and imports suggest further evidence of suppressed aggregate demand in the stressed economy.
General consensus shows Zimbabweans are largely unimpressed by the reports as they have heard similar words before with little changing at all on the ground. Contrary to President Mnangagwa’s recent utterances that they as a government do indeed possess the solutions to Zimbabwe’s problems the economic indicators suggest that they are far from solving the most basic of problems.
While the US$50 million facilities may ease the current shortages it certainly leaves a lot to be done to deal with shortages to come. It is bleedingly obvious today’s fuel shortages are based on poor preparation from yesterday. While the government is focused on yesterday’s fuel shortages what of tomorrow?