MDC-T's Latest BodyBlow To Zimbabwe Economy

Diesel is now being queued for again, thanks to myopic policies of the Tsvangirai/Mugabe government. The Zimbabwe Independent reports in its latest issue that economists say the rise in the price of petrol will trnaslate into a 25% inccrease in the prices of food.. The MDC-T ministry of Energy, meantime, is threatening service station owners who the ministry claim hiked prices wihout authority from government.

There is now a frightening shortage of fuel and lubricants in Zimbabwe now.

Diesel has been the hardest hit and any service station that finds itself lucky enough to have diesel quickly finds a long queue forming.

You will recall that I told you a little while back on this blog that the new MDC-T minister of Energy, Engineer Elias Mudzuri, has issued a directive to the fuel industry stating that petrol, for instance, should be sold at no more than US$1.10 per litre.

Now the mnistry has said the new price, which is US$1.30 per litre of petrol, should apply only starting June 7. Service started charging this (sometimes more) as soon as prices of oil moved upwards on the international market.

Still, the MDC-PF government says that does not matter and they are threatening to deal with service stations that started charging higher prices before June 7.

Still, the crux of the matter of is that we are simply getting confirmation yet again that the MDC-T, because it has no policies of its own, is now simply adopting and implementing the failed ZANU PF policies.

Why is it that they refuse to learn. As Einstein said, madness is doing the same thing in the same manner over and over again and expecting a different result each time.

Price controls do not work, full stop. If prices appear to be too high, there is a deeper reason to it, usually to do with policy or shortage.

One importer I spoke to on Saturday says most importers are bringing in only around 2 000 at a time and he was puzzled, saying, "It appears there just isn't the money in the country."

True, the money is not there in Zimbabwe. The "humanitarian assistance" that the world is pledging does not go into the economy, since most of the supplies being bought for humanitarian purposes are purchased outside Zimbabwe (South Africa is doing very well economically from the Zimbabwe economic crisis).

Even salaries are not spared, with most of the people in the humanitarian sector, be they UNICEF or whatever, are foreign aid workers and their salaries do not get spent in Zimbabwe to any meaningful extent.

But, more importantly, and to get back to the fuel situation in Zimbabwe, this is indeed a strange sight: MDC-T joining hands with ZANU PF to implement ZANU PF policies and expecting that the results will be different simply because the MDC-T is now part of government!

It will not work, and we already have the proof now.

Zimbabweans themselves have learnt that if you open up the market and let market forces dictate price, you will find that everything balances out.

But no, the MDC-T, because it is cut from the same ideological cloth as ZANU PF, sees nothing wrong in trying to control private enterprise and the markets.

The result is the shortage we now experience with diesel especially.

This shortage has huge ramifications: most factories in Zimbabwe power their plants with diesel, especially seeing as our electricity is still being cut willy-nilly and affecting production. Diesel shortage means that more and more of them will be back to the days when they are prepared to pay a premium to get that fuel.

As a result, goods and services will rise in price.

Already, as most of you know, the Consumer Council has indicated, a full month after I warned about it here, that Consumer Basket has gone up in price.

It will get worse.

Through all this, I laugh as I see the MDC-T and its supporters trying desperately to paint a picture of "positive changes" in Zimbabwe. I marvel when I see them defending the same Mugabe policies that they criticised in opposition.

All along, I thought it was only ZANU PF that engaged in wishful thinking!


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