Opinion / Columnist
Zimbabwean fuel shortages exposes ED's softness
29 Dec 2018 at 00:41hrs | Views
If there is a year which every person wishes it goes and never to be remembered again is 2017. Zimbabwe has and is still suffering unprecedented fuel shortages. Queues of more than five miles had seized to be an eyesore and become an amazemt. One can not imagine the amount of money time and business the country is losing while in fuel queues. Nobody seems to care and nothing seems to change. We are done bootlicking the government has failed its people and no meaningful action is seen to be taken. Promises alone do not bring in fuel in our tanks.
Government has no business running any business. It must discharge its duty and make fuel available to the people. One can not begin to imagine the pain and suffering one goes through at a fuel queue in Zimbabwe.
The petroleum downstream sector is a huge business that should be weaned off government control. Yes, crude oil accounts for over 70 percent of government revenue, but that doesn't mean government should continue to dictate what happens in the sector.
A country where the Government still imports petrol for everyone, is not a serious country.
The Government doesn't even have the capacity or the storage facilities to continue with this herculean endeavor. Why then don't we allow Individuals to venture into the business, import petrol and sell as the market dictates?
Petrol is a product. Economics says if Mr. A, B, C and D all sell the same product, competition will someday make Mr. C sell at a lower price to beat Mr. A. P Zimbabwe must allow fuel to be imported by those able and release the nation from this petroleum bondage.
It's called market forces.
Demand and supply is what drives any economy. Not government regulation.
Yes, petrol pump price could spike initially in a deregulated market, but someday, competition could force pump price of petrol down like every other product in the market. This does not need a PHD to implement it. Zimbabweans are now being dragged back to stone age by stifling the fuel supply.
Besides, the government-would also be a player in this market and could decide to sell its own petrol at government subsidized, friendly price.
But to allow the NOCZIM to continue as the sole importer of petrol in a government regulated market is economic madness.
Zimbabwe needs to Refine its own petrol
Point to another country that exports crude oil and imports the finished product.
Zimbabwe is a sorry case.
We have refineries that can't cater to our domestic needs because corruption has made them comatose. Zimbabwe has fuelled black markets and fuel is deliberately being withheld because service station managers are making a kill out of it.
To get out of this perennial fuel scarcity, Zimbabwe has to begin to produce and refine the petrol it consumes. It's not rocket science.
The reason we have scarcity now is because Government imports petrol. So, the product is sometimes inadequate or remains at sea for God knows how long, or is subject to the whims and caprices of the international market.
Sometime back Zimbabwe was making petrol from Sugar cane. Whoever stopped must be hanged. Resources must be hastened to production of our own fuel. Fuel is not a foreign currency spinner so it pays if it is produced locally.
Our refineries have to start working. Zimbabwe has to refine its petrol and not sell its residue and import same. That is the definition of idiocy.
Private firms should be handed licenses to run modular and standard refineries alongside government ones. If we have as little as 2 refineries serving the domestic market, we won't be here.
We'll keep having this problem every time the landing price of petrol at the port goes above the government approved pump price.
One of the mantras of the ED's administration is " Zimbabwe is Open For Business' but it must be added that we must produce what we consume and consume what we produce." Zimbabwe has become a supermarket. We only consume with no supervision.
That isn't happening in the downstream sector at the moment. Time to fix up.
Deal with the marketers
Independent marketers are so powerful, they can decide to store the product in depots or tank farms while anticipating a price hike from government in the New Year.
Refine our own petrol
Point me to another country that exports crude oil and imports the finished product.
Zimbabwe has been battling fuel scarcity forever. The solution is right here at long last.
If you spent your Christmas hustling for petrol to power your car or generator, please accept our heartfelt sympathy.
You certainly were not alone in this agony.
What does Zimbabwe need to do to break out of this endless cycle of petrol scarcity especially around Christmas and new year time.
What do we need to do as a nation to prevent this suffering that comes with petrol scarcity from recurring?
That's one of the reasons why we keep having these shortages of gas.
The action of the marketers is called economic sabotage and economic sabotage is a crime.one wonders why these people are not arrested. Is it our police or somebody in the government is benefiting from the shortages.
Basically because People need to power their generators to be able to travel they end up at this petrol station where attendants take them behind the scenes, point them to gallons of petrol and ask them to buy petrol above the government approved pump price.
buyers do nothing because they have no choice in the matter.
This is what happens across the land. There is petrol, but it makes more economic sense to the marketers to hoard, make the product scarce and sell at a higher price. When demand surpasses supply, prices go up.
That's where we are right now. There's demand, artificial scarcity and greed from marketers. It's the perfect recipe for queues at gas stations.
The police are not doing their work.
In hard times like this will need tough measures. The army must move into the petrol stations restoring legacy. If the army claimed to be patriotic this is the time to show it.
The Police and relevant government agencies need to arrest some major and minor marketers and make them cool their heels in jail for a while, just to serve as a deterrent.
Otherwise, we'll be in this trouble for a long time to come.
Kill corruption
One of the biggest challenges confronting Zimbabwe is the scale of corruption across all sectors of the economy.
The oil sector is no different.
Petrol tankers divert the product meant for the Our market to neighbouring countries by paying off Customs officials or other border patrol units.
This has been going on for years and it's something we've got to stop.
Zimbabwe has to improve storage facilities
So,Zimbabwe imports this petrol and because it has no capacity to store the volume of petrol it imports, it hands the task of storage to major marketers.
They then sell the product at the black market while you and I sweat it out on long, agonising queues. It's a vicious cycle.
Why can't Zimbabwe have as much as it can manage and call off the bluff of these independent marketers?
Why does the Country need to come to foreign market to get petrol that would be distributed round the country when it can establish depots in all major cities that would serve adjoining towns?
Why do we need tankers to lift petrol from Messina when we can distribute petrol through sophisticated and secure underground pipes.
zimbabwe seriously needs to up its game.
Until the country proves to the independent marketers that it can do this business without them, we won't get out of this scarcity problem.
ED has to create a petroleum ministry
The president has no business keeping the role of substantive petroleum minister for himself. It's a huge task that one shouldn't combine with running what is a difficult country.
There is more silence than mystery about the persistent petrol shortage that is making life difficult in the country. And the short-term solution is clear. Now it is time for the Government to get the pumps re-opened - then we can consider a more efficient market solution.
Although fuel company executives and government officials have done little to inform the public, the outlines of the problem are no longer in serious dispute.
Controls and subsidies distort markets, impeding economic efficiency and discouraging innovation. In this space we have repeatedly warned of the dangers inherent in constraining markets. We certainly hope governments will remember this dilemma the next time they're tempted to overrule market prices.
But the car has to be moving before you can take a right turn. The first problem now is that there is no petrol, or too little, for sale across large parts of the Country a paradox in this oil-rich federation and an obstruction to the routines of daily life for ordinary people. But the Government could solve the shortage with one simple promise: to pay retail companies enough per litre that they can break even.
The long-term solution to this problem is surely a rediscovery of respect for the iron realities of the market: petrol prices should be allowed to rise gradually. Adding more refining capacity in the future could also help to reduce imports.
But the short-term solution, in the interests of fairness across the country, involves wading a little deeper into subsidies.
ED must stop being Soft as a wool. He must order enforcement on fuel offenders. Service stations must be de licensed if they promote blackmarket. Those who hoard products must be sentenced to death. Our problems are cosmetic they are artificial they can be solved. Our government must serious.
Cry the beloved country.
Vazet2000@yahoo.co.uk
Government has no business running any business. It must discharge its duty and make fuel available to the people. One can not begin to imagine the pain and suffering one goes through at a fuel queue in Zimbabwe.
The petroleum downstream sector is a huge business that should be weaned off government control. Yes, crude oil accounts for over 70 percent of government revenue, but that doesn't mean government should continue to dictate what happens in the sector.
A country where the Government still imports petrol for everyone, is not a serious country.
The Government doesn't even have the capacity or the storage facilities to continue with this herculean endeavor. Why then don't we allow Individuals to venture into the business, import petrol and sell as the market dictates?
Petrol is a product. Economics says if Mr. A, B, C and D all sell the same product, competition will someday make Mr. C sell at a lower price to beat Mr. A. P Zimbabwe must allow fuel to be imported by those able and release the nation from this petroleum bondage.
It's called market forces.
Demand and supply is what drives any economy. Not government regulation.
Yes, petrol pump price could spike initially in a deregulated market, but someday, competition could force pump price of petrol down like every other product in the market. This does not need a PHD to implement it. Zimbabweans are now being dragged back to stone age by stifling the fuel supply.
Besides, the government-would also be a player in this market and could decide to sell its own petrol at government subsidized, friendly price.
But to allow the NOCZIM to continue as the sole importer of petrol in a government regulated market is economic madness.
Zimbabwe needs to Refine its own petrol
Point to another country that exports crude oil and imports the finished product.
Zimbabwe is a sorry case.
We have refineries that can't cater to our domestic needs because corruption has made them comatose. Zimbabwe has fuelled black markets and fuel is deliberately being withheld because service station managers are making a kill out of it.
To get out of this perennial fuel scarcity, Zimbabwe has to begin to produce and refine the petrol it consumes. It's not rocket science.
The reason we have scarcity now is because Government imports petrol. So, the product is sometimes inadequate or remains at sea for God knows how long, or is subject to the whims and caprices of the international market.
Sometime back Zimbabwe was making petrol from Sugar cane. Whoever stopped must be hanged. Resources must be hastened to production of our own fuel. Fuel is not a foreign currency spinner so it pays if it is produced locally.
Our refineries have to start working. Zimbabwe has to refine its petrol and not sell its residue and import same. That is the definition of idiocy.
Private firms should be handed licenses to run modular and standard refineries alongside government ones. If we have as little as 2 refineries serving the domestic market, we won't be here.
We'll keep having this problem every time the landing price of petrol at the port goes above the government approved pump price.
One of the mantras of the ED's administration is " Zimbabwe is Open For Business' but it must be added that we must produce what we consume and consume what we produce." Zimbabwe has become a supermarket. We only consume with no supervision.
That isn't happening in the downstream sector at the moment. Time to fix up.
Deal with the marketers
Independent marketers are so powerful, they can decide to store the product in depots or tank farms while anticipating a price hike from government in the New Year.
Refine our own petrol
Point me to another country that exports crude oil and imports the finished product.
Zimbabwe has been battling fuel scarcity forever. The solution is right here at long last.
If you spent your Christmas hustling for petrol to power your car or generator, please accept our heartfelt sympathy.
You certainly were not alone in this agony.
What does Zimbabwe need to do to break out of this endless cycle of petrol scarcity especially around Christmas and new year time.
What do we need to do as a nation to prevent this suffering that comes with petrol scarcity from recurring?
That's one of the reasons why we keep having these shortages of gas.
The action of the marketers is called economic sabotage and economic sabotage is a crime.one wonders why these people are not arrested. Is it our police or somebody in the government is benefiting from the shortages.
Basically because People need to power their generators to be able to travel they end up at this petrol station where attendants take them behind the scenes, point them to gallons of petrol and ask them to buy petrol above the government approved pump price.
buyers do nothing because they have no choice in the matter.
This is what happens across the land. There is petrol, but it makes more economic sense to the marketers to hoard, make the product scarce and sell at a higher price. When demand surpasses supply, prices go up.
That's where we are right now. There's demand, artificial scarcity and greed from marketers. It's the perfect recipe for queues at gas stations.
The police are not doing their work.
In hard times like this will need tough measures. The army must move into the petrol stations restoring legacy. If the army claimed to be patriotic this is the time to show it.
The Police and relevant government agencies need to arrest some major and minor marketers and make them cool their heels in jail for a while, just to serve as a deterrent.
Otherwise, we'll be in this trouble for a long time to come.
Kill corruption
One of the biggest challenges confronting Zimbabwe is the scale of corruption across all sectors of the economy.
The oil sector is no different.
Petrol tankers divert the product meant for the Our market to neighbouring countries by paying off Customs officials or other border patrol units.
This has been going on for years and it's something we've got to stop.
Zimbabwe has to improve storage facilities
So,Zimbabwe imports this petrol and because it has no capacity to store the volume of petrol it imports, it hands the task of storage to major marketers.
They then sell the product at the black market while you and I sweat it out on long, agonising queues. It's a vicious cycle.
Why can't Zimbabwe have as much as it can manage and call off the bluff of these independent marketers?
Why does the Country need to come to foreign market to get petrol that would be distributed round the country when it can establish depots in all major cities that would serve adjoining towns?
Why do we need tankers to lift petrol from Messina when we can distribute petrol through sophisticated and secure underground pipes.
zimbabwe seriously needs to up its game.
Until the country proves to the independent marketers that it can do this business without them, we won't get out of this scarcity problem.
ED has to create a petroleum ministry
The president has no business keeping the role of substantive petroleum minister for himself. It's a huge task that one shouldn't combine with running what is a difficult country.
There is more silence than mystery about the persistent petrol shortage that is making life difficult in the country. And the short-term solution is clear. Now it is time for the Government to get the pumps re-opened - then we can consider a more efficient market solution.
Although fuel company executives and government officials have done little to inform the public, the outlines of the problem are no longer in serious dispute.
Controls and subsidies distort markets, impeding economic efficiency and discouraging innovation. In this space we have repeatedly warned of the dangers inherent in constraining markets. We certainly hope governments will remember this dilemma the next time they're tempted to overrule market prices.
But the car has to be moving before you can take a right turn. The first problem now is that there is no petrol, or too little, for sale across large parts of the Country a paradox in this oil-rich federation and an obstruction to the routines of daily life for ordinary people. But the Government could solve the shortage with one simple promise: to pay retail companies enough per litre that they can break even.
The long-term solution to this problem is surely a rediscovery of respect for the iron realities of the market: petrol prices should be allowed to rise gradually. Adding more refining capacity in the future could also help to reduce imports.
But the short-term solution, in the interests of fairness across the country, involves wading a little deeper into subsidies.
ED must stop being Soft as a wool. He must order enforcement on fuel offenders. Service stations must be de licensed if they promote blackmarket. Those who hoard products must be sentenced to death. Our problems are cosmetic they are artificial they can be solved. Our government must serious.
Cry the beloved country.
Vazet2000@yahoo.co.uk
Source - Dr Masimba Mavaza
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