Financial Gazette (Harare)
Shame Makoshori
29 November 2008
Harare — A SENIOR government official has recommended the transformation of the National Oil Company of Zimbabwe (NOCZIM) into a regulatory board overseeing the petroleum industry instead of maintaining its dual role of importing and distribution fuel while at the same time controlling competition.
In a rare criticism of public policy by a member of President Robert Mugabe's government, Deputy Economic Development Minister, Aguy Georgias, said one of the most effective ways to reverse the fuel shortages affecting the country would be to restrict NOCZIM's responsibilities to that of regulating the fuel industry in Zimbabwe.
"NOCZIM, in my view should be restructured to play an effective regulatory role in fuel distribution," Georgias said.
He was addressing delegates at the Institute of Chartered Accountants of Zimbabwe (ICAZ) annual conference held in Harare last week in a speech that also touched on the revival of the Zambezi Seaway Project, which Georgias said could help reduce the cost of transporting goods into the country.
Georgias is an industrialist and founder of Trinity Engineering, an engineering firm that manufactures trailers, water and fuel tanks.
NOCZIM's responsibilities encompass both the distribution of petroleum products and the regulation of the fuel industry.
Government was forced to break the parastatal's monopoly in the importation of fuel after it had been overwhelmed by demand following the precipitous foreign currency shortages.
The parastatal is still however struggling to supply the market with fuel, a situation critics say showed NOCZIM does not have the capacity to supply the market alone.
Zimbabwe needs an estimated US$40 million for its monthly fuel requirements.
The economy requires 900 million litres of diesel and 730 million litres of petrol every year to operate at full capacity.
Since the deregulation of the fuel industry, a litre of diesel or petrol has been selling in Zimbabwe at anything between US$1,20 and US$1,50. The price has come down in recent weeks due to the slowdown in the global economy with direct fuel importers quoting prices ranging from US$0,80 cents to US$0,90 cents.
Turning to the controversial indeginasation and empowerment policies, which seeks to expropriate 50 percent shareholdings in foreign owned companies, the Georgias said this was a bad policy, which should be shelved to allow potential investors to bring in Foreign Direct Investment.
"This policy, I think should be suspended," he told the ICAZ conference.
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