8 October 2018

Zimbabwe: RBZ Releases Us$41m for Fuel

Photo: The Herald
Reserve Bank of Zimbabwe Governor John Mangudya.

Fuel queues that resurfaced in most parts of the country over the weekend are expected to ease this week following the release of US$41 million by the Reserve Bank of Zimbabwe (RBZ) last Friday towards fuel procurement, central bank Governor Dr John Mangudya has said.

The money is part of the US$500 million line of credit announced in the Monetary Policy Statement issued by RBZ last week to fund the procurement of essential commodities that include fuel, electricity, wheat, raw materials for the manufacturing of cooking oil, packaging and other basic commodities.

"The Reserve Bank of Zimbabwe wishes to advise members of the public that it has started drawing down foreign currency from the US$500 million lines of credit advised in the Monetary Policy Statement issued by the bank last week," said Dr Mangudya in a statement yesterday.

Regarding fuel, Dr Mangudya said supplies and deliveries to filling stations were already underway.

"The bank released US$41 million for the procurement of fuel on Friday, the 5th of October, 2018 and the fuel is currently being supplied and delivered to the various filling stations and supply points across the market," he said.

In light of these developments, Dr Mangudya reiterated that there was enough fuel in the country, hence there was no need for panic-buying and hoarding.

"In view of these positive developments, the bank would like to assure the public that there is sufficient fuel available in the country and therefore there is no need for panic-buying of fuel and other essential commodities," he said.

He paid tribute to the National Oil Company of Zimbabwe for ensuring that the fuel was delivered to oil marketing companies across the country.

Dr Mangudya criticised the increase in foreign currency parallel market rates, which he blamed on crooks cheating people of their hard earned income. The increase in foreign currency parallel market rates has triggered a rise in the prices of basic commodities.

"The opportunists are manipulating foreign currency parallel market rates to cause unnecessary panic and despondency and destabilisation of the economy. Such counterproductive behaviour is unwarranted and should be condemned by all peace-loving Zimbabweans," said Dr Mangudya.

Dr Mangudya insisted that the multi-currency system would remain in place and that the RBZ would continue to secure more lines of credit to supplement the country's foreign currency earnings, mainly from exports and diaspora remittances.

The past week has seen foreign currency parallel market rates spiralling. As of yesterday, US$100 was being sold at $265 for electronic transfers and $215 for Bond notes. These changes saw an increase in prices of basic commodities such as cooking oil, sugar and many others.

The health sector has also responded with some medical institutions suspending use of point of sale machines and mobile money transfers.

Other medical service providers have increased prices for drugs and sundries in response to the parallel market rates. Some have suspended use of medical aid cards. Avenues Clinic in Harare is one of the health institutions that have increased prices of drugs and sundries.

"We have made a temporary upward adjustment to stock prices across the board and this is effective immediately, while we monitor the situation throughout the weekend," said the Avenues chief executive Mr Searchmore Chaparadza.

He said the review was temporary and could be amended by Monday (today) depending on the situation on the ground.

Trinity Pharmacy also wrote to medical aid societies that it was no longer accepting medical aid cards, arguing that their suppliers required foreign currency, which they could only access at parallel market rates.

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