Thursday, 17 January 2019

Stop Robbing The Public Again

Since Saturday last week, Zimbabwe is one of the world’s most expensive places to buy fuel from.

That’s after President Emmerson Mnangagwa announced new prices that showed an increase of over 150% for both petrol and diesel.

General fuel increases are usually announced by the Zimbabwe Energy Regulatory Authority (Zera), Energy minister or his secretary.

But with the long queues of frustrated motorists – which have become a feature since October last year and a new symbol of the ineptitude of the New Dispensation – the issue became elevated to a point where Mnangagwa himself had to make the announcement.

The message was clear; “the buck stops with me, I am in charge,” Mnangagwa said.

The shortages were unsustainable, he said, and were “attributable to increased fuel usage in the growing economy and compounded by rampant illegal currency and fuel trading activities”.

The rather steep price increase would shore up the fuel retailers, he said and in the eyes of some, the new prices were an indirect acknowledgement by government that its rather disastrous 1:1 official exchange rate for the US dollar and the bond note was a fallacy.
Stop Robbing The Public Again
But as usual, Mnangagwa’s pronouncement was not the whole truth.

If Mnangagwa’s appearance was meant to ease public anxiety and convey the strength of a “listening President”, the figures say otherwise.

The numbers say Mnangagwa and his financial engineer Finance minister Mthuli Ncube had just concocted another way of robbing the public again and to hell with the consequences.

While fuel prices rose by just over 150%, government taxes on fuel rose 324% to an average of $2,296 per litre, guaranteeing annual revenue of $4,41 billion to Treasury coffers.

Government stands to make $2,11 per litre of diesel sold and $2,48 cents from every petrol litre sold. Garages make 15 cents per litre, up from six cents.

This explains the continued shortages of fuel despite the price increases: just like the unpopular 2% tax on electronic transfers, the Mnangagwa administration has found another way to rob its people again to raise funds to pay off its largely unexplained $10 billion domestic debt.
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