Panic, greed or both?

11 03 2026
The bad news on a local filling station prices board

On Wednesday morning the previous day’s rumour of fuel price increase was proven correct. Diesel price had gone up from $1.53 per litre to $1.77. Please note that is US dollars not the local ZWG dollar which despite being an official and rate-controlled currency nobody wants it, most certainly not the fuel stations.

The reason given for the price increase is the ongoing war in Iran. I suspect that it’s a convenient excuse to bleed the Zimbabwean public of yet more money. Yes, the increase in crude oil price is going to cause a knock-on effect to the pump prices but nearly 16%? What does the government think the knock on to cost of living is going to be? Do they care? Will it come down if or when the fuel prices are reduced? Not a chance!

Being a landlocked country all imports of consequence come in by road or rail. A telling exception is the fuel pipeline from the Mozambique port of Beira to Mutare, a city on the eastern border of Zimbabwe, which accounts for some 90% of fuel imports. This means that oil price increases are going to have a minimal effect on pump costs. This doesn’t seem to have been incorporated into the ZERA (Zimbabwe Energy Regulatory Authority) calculation of how the maximum allowable fuel price arrived at. ZERA is the government body that regulates maximum fuel prices – I am not sure what else it does if anything.

The ZERA attempt at legitimizing the fuel price increase falls short of convincing

More tellingly there is no indication of how much the source price has changed so it is effectively meaningless. The government has lost no time in telling us just how lucky we have been that it didn’t increase more (last paragraph in italics below):

The petroleum prices are with immediate effect from 4 March 2026 for the next two weeks. In the meantime, ZERA will be closely monitoring the market developments to ensure that there is adequate supply in the market.

The above prices are as a result of Government reducing some of its charges to cushion the consumers from astronomical increases that have happened from changes in the international market.

Without Government cushioning, the actual prices would have been US$1.90/litre for diesel and US$1.81/litre for blend.”

This is from a government that has imposed taxes on bank transfers of 2% (some are exempt such as pensions), 2% tax on cash withdrawals from banks and a VAT of 15.5% that has just gone up from 15%. Income is taxed starting at $100 per month. Foreign currency transactions by debit card now attract a 15% tax. This is a government desperate for cash.

The shortage of cash is evident in the public sector. The road from Bulawayo to Victoria Falls is nearly impassable in places. There are lots of others. Talking to a friend who lives in the eastern highlands area of Nyanga she tells me that it takes her an hour to go 7km along a road that became impassable in January due to heavy rains and other stuck vehicles. Roads in our suburb of Mount Pleasant can require a good deal of patience to negotiate and the problem is widespread in Harare. Power outages and poor voltage are endemic and municipal water is erratic and at best a trickle (ours goes into the swimming pool for storage). What was once the pristine central business district of Harare is now the proverbial dog’s breakfast of rubbish, potholes, vendors and a bad smell to boot.

The tax department works! It’s had a complete makeover in the last year or so and nearly everything is doable online. That’s including the notorious QPDs (Quarterly Payment Due) whereby one has to estimate the company profit or loss four times a year with penalties enforced for being inaccurate. Yes, you got it – taxed in advance!

Businesses eligible to charge VAT have to have a computerised point-of-sale that is linked to the tax department’s computer system and every invoice or cash sale has a QR code on it. Scan the QR code and you can see a representation of the invoice. Try it on the example. I have to admit that I’m impressed.

A typical invoice from a VAT registered company

So when the government hikes the fuel price by nearly 16% and tells us that it could have been more I am sceptical (I am already cynical).

Postscript: In the time taken to write this blog fuel pump prices have rocketed the world over. The Zimbabwe government might just have to rescind its decision to “cushion” price increases. So far there haven’t been reports of fuel shortages but the bulk diesel price on the sign pictured is now zero – none to be had.





A storm approaching

31 03 2025
Storms develop south of the local microlight club where we fly model aircraft

“Nah, it’s a ZANU-PF problem, they must sort it out themselves” Fabian responded when I asked him if he was going to join today’s protest march in the centre of Harare. Fabian was a non-combatant porter in Robert Mugbe’s ZANLA army as a young man in Zimbabwe/Rhodesia’s bush war which ended in 1980. He has little time for the ZANU-PF political party that Mugabe founded.

The current Zimbabwean president, Emerson Mnangagwa, is looking to extend his presidency to a third term of five years. Zimbabwe’s constitution forbids this and protests have been planned for today which will be spearheaded by Blessed Geza who was a ZANLA veteran. Not surprisingly this has led to accusations of treason from Mnangagwa even though demonstrations are allowed under the constitution. While a lot of Zimbabweans are thoroughly fed-up with an inept and kleptocratic government the cynics are saying that it’s just a changing of the guard – a different herd of snouts to the trough.

Last week saw amoured cars and troop carriers on the streets in an attempt to intimidate would-be protestors. There were road blocks manned by police stopping traffic going into town though yesterday evening, when I came back from the airfield, the one on the main road in had packed up.

The organizers of the protest were clear in their instructions to the general public; stay out of the city centre though this may have been disinformation by the government. Schools are shut today and most businesses are closed or working with reduced staff. There was very little traffic about when we went out to walk the dogs on ART farm. My business is working on essential staff only as we really didn’t know what to expect.

There were videos on social media this morning of protestors starting to march into town. They must have been aware that the last time this happened it all turned nasty when the army opened fire killing six. This is not like Turkey at the moment where thousands of students are gathering every evening to protest the collapse of the country’s democracy. They only have to put up with tear gas.

On the way back home I stopped at a local hardware store to get a jerrycan for my paramotor fuel. “Have a nice day” the cheerful teller girl said as I was leaving. “Yes”, I replied, “and tomorrow we’ll have a new government” giving her a large wink. She giggled, “So, what are you doing here then?” was her response.

It did rain last night. In some areas the storms were violent but here it was just 14mm of rain. Enough to make us thankful for the 4×4 capability of my truck on the very sticky ART farm roads.





The law and the numbers

3 03 2014

“Chinamasa’s Job on the Line” blared the title page of the Financial Gazette, the weekly financial newspaper, on sale yesterday. Now the newspaper billboards in this country are as about as misleading as anywhere but the FinGaz or Pink Paper (the cover is printed on pink newsprint) is a little less sensationalistic than the rest of the competition and it does like to take itself a bit more seriously. So I bought a copy at the traffic lights (I made sure other vehicles could get past) and well, I needed some paper to start the braai (barbeque).

Patrick Chinamasa is the current Minister of Finance who has the unenviable job of finding enough money to keep the government running when it is obviously broke. Apparently President Mugabe had told him if he wasn’t up to the job he’d find someone else to do it.

Chinamasa’s background is not in finance. I’m not sure what history is but he certainly had an easier run in his former portfolio as the Justice Minister. Mind you, it’s easy to run a ministry like that when you control the police so you effectively ARE the law. Paradoxically the previous finance Minister was Tendai Biti who actually is a lawyer and did a good job with extremely limited resources.

The FinGaz also notes that Chinamasa came back empty-handed from a recent world tour to source finance for the beleaguered government. No real surprise this as apparently potential investors are concerned about the 51% law which requires all Zimbabwe companies to have a majority indigenous shareholder. Despite being born here I am not indigenous – all locally born blacks are considered indigenous as is anyone born after independence in 1980. Well, Comrade Chinamasa likely has an insurmountable problem ahead of him. The laws of economics (which is just a branch of mathematics) are inviolate unlike his previous ministry where the law was wide open to manipulation and interpretation. And even our good friends the Chinese don’t want to help out.





In the news

7 02 2009

It seems that Barack Obama will get most of his economic rescue package through the Senate. Nobody knows for sure if it will work but they are going to have to give it a try even if it does create a trillion dollar budget deficit. The Zimbabwe Government has not been paying attention and seems determined to kill off the economy before it can even start. In the process they have also removed another 12 zeros off the Zim dollar; that makes it 28 in just over 2 years. How they will ever restore faith in the local currency is beyond me!

Yesterday, chatting to my local pharmacist, I was told that the Reserve Bank officials had been calling to see that businesses in the area were licensed to deal in real money. Most formal outlets will be charged 12000 USD a year, payable as $1000 a month. This is certainly beyond my limits and I gather that a lot of businesses have simply stopped trading. Informal traders (on the street) will be charged $25 a year so perhaps there will be surge of vendors outside more formal outlets.

Italy is all in a tizzy over the ruling by their highest court that the woman who has been in a vegetative state for the last 17 years be allowed to die with Berlusconi trying to halt the process and the president refusing to sign his decree (as unconstitutional). The Vatican, predictably, in some absurd right to “life” issue would like her to carry on in the vegetative state for as long as modern medicine can keep her that way. This would undoubtedly be a very long time. Withholding sustenance until she dies would not be cruel – she essentially died 17 years ago, but it would certainly be a release for her family from a person they no longer know. The chances of a spontaneous recovery are close to zero. I have it written into my will that in case I enter into such a state with no chance of recovery I be allowed to die. A lawyer pointed out a while back that it has to be a living will so I’d better change it sometime.