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Zimbabwean authorities have increased fuel prices for the second time in a week and it is making it impossible for small businesses to survive.
Monday brought news of Zimbabwe increasing fuel prices yet again in what is actually the second significant price hike in less than a week. But most pumps remained dry, with no end in sight to shortages that are helping drive inflation rapidly higher.
The Zimbabwe Energy Regulatory Authority stated today that a litre of petrol would now cost 7.45 Zimbabwean dollars, up 22 percent from 6.10 Zimbabwean dollars. Diesel goes for 7.19 a Zimbabwean dollars a litre, doing a 23 percent rise of its own.
On July 13, fuel prices were hiked by up to 16 percent after Finance Minister, Mthuli Ncube, said fuel was considerably cheaper than in neighbouring countries. The Minister stated the intention of the government to see the price increase to the equivalent of USD 1.00 a litre.
With inflation climbing to alarming levels, economic analysts agree that the increase in the price of fuel are adding to price pressures, especially as the continued epileptic power supply in the country are forcing businesses to use expensive diesel generators to power their operations.
Diesel and petrol prices have surged by as much as 456 percent since the turn of the year, following a slide in the value of the local RTGS currency, renamed the Zimbabwe dollar last month.
The biggest fuel price hike in January, a 150 percent increase, sparked unrest in the country as Zimbabweans took to the streets in protests which turned ugly. Over a dozen lives were lost in a number of violent protests that saw the Zimbabwean army trying to clamp down on the marauding crowd.
The Zimbabwe dollar was trading on Monday at 8.88 Zimbabwean dollars against the US dollar on the official interbank market, pretty much the same as last week. On the black market, 10.5 Zimbabwe dollars is the going rate for one US dollar.
Featured Image Courtesy: BBC
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