Zimbabwe's president hikes fuel prices to tackle shortages

Zimbabwe economic crisis: Fuel price hike, national strike and a new currency

The hike means petrol prices rose from $1.24 (£0.97) a litre to $3.31, with diesel up from $1.36 a litre to $3.11.

In a televised address on Saturday, President Mnangagwa said the fuel price hike would address the ongoing fuel problems, which have seen motorists queuing for hours at petrol stations.

"So far the stay-away has been effective", Peter Mutasa, President of the Zimbabwe Congress of Trade Unions, said by phone.

Evan Mawarire, a cleric and activist who led anti-government protests in 2016 that shut down major cities, said: "You have cornered us and you leave us no choice".

"The fuel prices must come down, we are not going anywhere until they bring it down".

Morrisson Nxulmalo, an unemployed 33-year-old Zimbabwean, told Al Jazeera he was prepared to protest until the government reversed the price increase. "He's making life hard for us and these police are trying to stop us as if they don't know our pain", said Ncube.

"The ZCTU general council resolved to call for a nationwide stay-away with effect from midnight today following the insensitive and provocative increase of the fuel price by the president of Zimbabwe", the confederation, which represents people ranging from journalists to rail workers, said in a Twitter posting.

The fuel shortages which hit the nation in October past year have left thousands of commuters stranded.

Before the increase, diesel cost $1.38 a litre, and petrol $1.43 a litre. However, to the detriment of the people who believed that they were voting for change, Mnangagwa revealed that petrol prices would rise to Z$3.31 (R45.79) for petrol and Z$3.11 (R43.03) for diesel.

"You can also expect that fuel will now mostly be available, but then it will be sold in USA dollars".

Deputy Information Minister Energy Mutodi tweeted that commodity price volatility "will be temporary before goods prices normalise".

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Mnangagwa also warned the government would deal harshly with those "bent on taking advantage of the current fuel shortages to cause and sponsor unrest and instability in the country".

Zimbabwe adopted the use of multi-currencies in 2009 after its local currency had been rendered worthless by hyperinflation.

But now there is not enough hard currency to back up more than $10 billion in electronic funds trapped in local bank accounts, prompting demands from businesses and civil servants for cash that can be deposited and used to make payments.

Mnangagwa himself was on Sunday setting off on a five-nation tour that starts in Russian Federation and ends at the World Economic Forum in Davos, Switzerland.

Although Mnangagwa announced a package of measures "to cushion government workers", he gave few details.

"The consequences of this move are the following: this massive increase, of course market related, will be highly inflationary".

An assistant at a service station owned by Zuva Petroleum said: "We have not received any supplies since Thursday evening but we are hoping we will get a delivery before end of the day".

"To curb continued misuse of fuel in the country, Government, through relevant departments which include its security structures, have started on a comprehensive audit of all fuel draw-downs with a view to establishing points of leakages", he said.

Residents of Epworth, 22 miles south of the capital, protested after the main labour federation called for a three-day strike starting on Monday in response to the price increase.

Teachers, who are not represented by ZCTU, are planning a nationwide strike from January 22, and civil servants have threatened to join them.

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