Harare — ZIMBABWE will reap considerable benefits from the sale of fuel in foreign currency, particularly at the country's darkest hour, where the hard currency coffers are at the lowest.

While the country might be spending much more than it is earning on fuel imports, the recent decision by the Reserve Bank will at least open a new avenue of constant supply of foreign currency into the formal system, albeit in not-so-large amounts.

Economic commentators say the country has positioned itself to mop up a significant chunk of small amounts of foreign currency that "have no real productive purposes on the market".

Furthermore, the RBZ's decision has provided a disincentive to the channelling of hard currency to the black market, although "black marketing will remain active, at a lower level".

Mr Farai Dyirakumunda, a financial analyst with Interfin Securities, said: "I think it's one step towards the issue of dollarisation.

"But definitely, the development will go some way in bringing in foreign currency into the official system. Assuming there will be availability of funds, people will always part with their hard currency on fuel. It is a positive move."

The National Oil Company of Zimbabwe on Tuesday designated a Comoil service station in Harare as the first to sell fuel in foreign currency. This is the first step in a rollout initiative that will see more service stations being accorded the status to trade fuel in hard currency.

Tourism expert Mr Shingi Munyeza said the long-term goal was to see more service stations, especially on major trunk roads leading into tourist destinations, getting the same status.

"This has been our lobby to the central bank over the last four years," Mr Munyeza remarked. "It is a dream come true for us in the tourism industry."

There is a lot of logic in having tourists purchasing fuel in foreign currency, particularly in major tourism areas such as the Victoria Falls and the Eastern Highlands.

Another economic and social commentator, Mr Jonathan Kadzura, had this to say:

"I think what the RBZ is trying to do is to offer an incentive to Zimbabweans who are holding insignificant amounts of foreign currency.

"To some extent, there will be black marketing but the end result is that the funds will be accounted for in the formal books.

"The few dollars that might have found their way out of the country will now be coming through into the formal system which is a positive development." Recent hikes in international prices have put a strain on non-oil-producing economies such as Zimbabwe, which rely heavily on oil imports.

In Zimbabwe, rising international prices have presented serious challenges to the country's efforts in procuring adequate fuel supplies, a situation which has been compounded by obtaining hard currency shortages.

Global oil prices have risen steeply from US$12 at the beginning of 1999 to US$61 per barrel last month, against the background of reduced international supply and increased demand.

There are fears that oil prices could escalate to around US$70 per barrel in the next few months.

However, at current consumption rates world demand for fuel is lower than initial projections due to a lower forecast in world economic growth of around 4 percent, which is less than the over 5 percent recorded last year.

Zimbabwe requires 900 million litres of diesel and 730 litres of petrol per annum to operate at full capacity, according to RBZ estimates.