News / National
Reason why there is no fuel
20 Jan 2011 at 23:35hrs | Views
The Zimbabwe Revenue Authority (Zimra) last month garnished $35 million from the National Oil Company of Zimbabwe's (Noczim) bank account, crippling the company's ability to import fuel leading to the current shortages being experienced in the country, it has been learnt.
This, coupled with an export "ban" by South Africa on fuel to Zimbabwe, has exacerbated the situation.
The ban by South Africa has seen the southern parts of the country, including Bulawayo and Victoria Falls, run dry.
Zimbabwe imports its fuel from South Africa and Beira in Mozambique. Fuel shortages in the last two weeks have seen the price of the commodity shooting up by more than 25% since the beginning of the year.
The largest change has been in diesel where the price has gone up from $1,10 to $1,40 a litre. Commuter omnibus operators in and around Harare have reportedly hiked fares to $1 from 50 cents during peak hours in the morning and evening, taking advantage of the fuel shortage.
Energy and Power Development minister Elton Mangoma told reporters this week that Noczim's debt amortisation account was wiped out as Zimra sought to recoup outstanding dues, throwing the state enterprise's operations into disarray.
He said Zimra's action, coupled with the failure by the government to secure long-term deals, had left the country's fuel situation in a precarious position.
"For the good part of December we didn't have any ships coming to Beira and the only fuel that was coming into the country was from South Africa," said Mangoma.
"South Africa did not have adequate supplies hence they also stopped supplying us. Then we had our own domestic affairs with $35 million disappearing from Noczim which was due to Zimra.
"Zimra garnished the account which contained the debt redemption levy and the strategic reserve levy hence taking away everything from Noczim."
He said in normal instances when there was a fuel shortage, government would release fuel from its strategic reserves but in this particular case it was not able to do so.
The embattled state enterprise is also reportedly under fire from private sector players whose fuel is stuck along the Beira-Feruka-Msasa pipeline.
It is estimated that 15 million litres of fuel are stuck between Beira and Feruka with an additional 11 million litres of a cocktail stuck between Feruka and Msasa.
To unlock the fuel stuck in the pipeline, the government must import fuel and pump it into the pipeline from Beira so that product comes out at the other end.
Mangoma said this was the solution to freeing the private sector fuel in the pipeline.
The problem was, however, that the government does not have money to make bulk purchases.
Mangoma, nevertheless, said Treasury was responding to the concerns and had started to release funds for fuel purchases.
The current impasse has renewed scepticism within the private sector when dealing with the government.
Mangoma also said the government was negotiating with fuel merchants to supply the country with fuel and just pay a drawdown.
He said Zimbabwe had the ability to supply Zambia, Malawi, northern parts of Botswana and southern parts of the Democratic Republic of Congo.
Zimbabwe has huge idle storage capacity in Southerton and Msasa in Harare and also in Gweru.
This, coupled with an export "ban" by South Africa on fuel to Zimbabwe, has exacerbated the situation.
The ban by South Africa has seen the southern parts of the country, including Bulawayo and Victoria Falls, run dry.
Zimbabwe imports its fuel from South Africa and Beira in Mozambique. Fuel shortages in the last two weeks have seen the price of the commodity shooting up by more than 25% since the beginning of the year.
The largest change has been in diesel where the price has gone up from $1,10 to $1,40 a litre. Commuter omnibus operators in and around Harare have reportedly hiked fares to $1 from 50 cents during peak hours in the morning and evening, taking advantage of the fuel shortage.
Energy and Power Development minister Elton Mangoma told reporters this week that Noczim's debt amortisation account was wiped out as Zimra sought to recoup outstanding dues, throwing the state enterprise's operations into disarray.
He said Zimra's action, coupled with the failure by the government to secure long-term deals, had left the country's fuel situation in a precarious position.
"For the good part of December we didn't have any ships coming to Beira and the only fuel that was coming into the country was from South Africa," said Mangoma.
"South Africa did not have adequate supplies hence they also stopped supplying us. Then we had our own domestic affairs with $35 million disappearing from Noczim which was due to Zimra.
"Zimra garnished the account which contained the debt redemption levy and the strategic reserve levy hence taking away everything from Noczim."
He said in normal instances when there was a fuel shortage, government would release fuel from its strategic reserves but in this particular case it was not able to do so.
The embattled state enterprise is also reportedly under fire from private sector players whose fuel is stuck along the Beira-Feruka-Msasa pipeline.
It is estimated that 15 million litres of fuel are stuck between Beira and Feruka with an additional 11 million litres of a cocktail stuck between Feruka and Msasa.
To unlock the fuel stuck in the pipeline, the government must import fuel and pump it into the pipeline from Beira so that product comes out at the other end.
Mangoma said this was the solution to freeing the private sector fuel in the pipeline.
The problem was, however, that the government does not have money to make bulk purchases.
Mangoma, nevertheless, said Treasury was responding to the concerns and had started to release funds for fuel purchases.
The current impasse has renewed scepticism within the private sector when dealing with the government.
Mangoma also said the government was negotiating with fuel merchants to supply the country with fuel and just pay a drawdown.
He said Zimbabwe had the ability to supply Zambia, Malawi, northern parts of Botswana and southern parts of the Democratic Republic of Congo.
Zimbabwe has huge idle storage capacity in Southerton and Msasa in Harare and also in Gweru.
Source - Byo24NEWS