Zimbabweans forced to adapt to another economic downturn
As Zimbabwe’s latest economic woes hit the two-week mark‚ Zimbabweans are adjusting to a new way of life characterised by basic commodity shortages and price hikes.
Those who drive have taken to social media for updates where one can find precious diesel and petrol. Long‚ winding queues - which typically start forming in the evening in anticipation of fuel deliveries - are now a permanent feature in towns and cities.
“There’s nothing new when it comes to queues‚” said Vivian Ncube‚ a clothing boutique owner. “The difference is that last year it was bank queues‚ where mostly pensioners and low-income earners would put up for the night. This time around‚ you find the well-to-do sleeping in their cars.”
Ncube’s phone keeps buzzing with WhatsApp notifications - mostly from groups where people share updates about fuel.
“I am in two groups‚ each has more than 200 people‚” she explained. “When someone shares information‚ within a minute there’s traffic to the nearest garage!”
During the early days of Zimbabwe’s fuel crisis‚ drivers who were not patient enough to wait in a queue for hours would take out their jerry cans‚ often on the pretext of their cars having already run out of fuel.
But energy minister Joram Gumbo on Tuesday pulled a fast one on queue-jumpers by banning the use of jerry cans. “Those using tanks‚ drums and jerry cans - all forms of containers - should stop‚” he told journalists. “We are sending out inspectors and the Zimbabwe Republic Police.”
Black-market fuel dealers typically charge 100% more than the official pump price - but they are failing to meet demand.
One such dealer explained that people “have a choice to spend half their productive days in a queue‚ where fuel can even run out while waiting‚ or simply spend two minutes with me and go.”
Of course fuel prices are not the only thing hit hard by Zimbabwe’s economic problems. In the country’s second largest city of Bulawayo‚ due to its relative proximity to South Africa and Botswana‚ some women have formed grocery clubs that travel across the border every week to buy affordable groceries.
“Big shops are stocked‚ but their prices kill us‚” said one shopper. “For example‚ in major grocery shops the bond note has the same value as the American dollar‚ which is not the case out there. A grocery list for say R3‚000 in Musina is almost three times more than what I can buy with $200 in bonds‚ which they argue is equal to $200 in American dollars.”
Zimbabwe’s government is aware of the price hikes and has set up a monitoring system. “We want to track the source of the increases and establish the stage at which the prices are being hiked‚” said Monica Mutsvangwa‚ minister of information‚ publicity and broadcasting services.
Bread is also crossing borders into the country. The Grain Millers Association of Zimbabwe (GMAZ) on Tuesday wrote to the government with a plea that at least 50 wagons full of wheat should be transported into the country from Mozambique to avert the current bread crisis.
Exchange rates took a hit last week and are set to worsen following the payment of health workers‚ with other civil servants set to be paid in the next few days.
“There is a renewed demand from ordinary people who would rather have their savings in hard currency because of the volatile nature of the bond notes. Their thinking is that if they get paid and lock their earnings in a currency that doesn’t lose value overnight‚ they are safe‚” said Tedius Ndoro‚ a forex dealer who formerly worked as a banker.
Indications from the government are that by the end of October there could be a stop-gap measure to salvage the local economy. Finance minister Mthuli Ncube is engaged in talks with the African Export-Import Bank (Afreximbank) for a $500-million nostro stabilisation facility.
Afreximbank confirmed this in a statement: “They discussed the modality of the $500-million nostro stabilisation facility‚ which Zimbabwe had requested from the bank‚ and agreed on the processes towards concluding that transaction by the end of October 2018.”