Passengers told plane had no fuel when they were already on board

Air Zimbabwe was so crippled by the fuel shortages that hit the country in 2003 that on one occasion the national airline told its passengers bound for Bulawayo and Victoria Falls that the plane had no fuel when they were already on board.

The passengers had to wait for hours until the airline borrowed fuel from another airline.

Full cable:

Viewing cable 03HARARE2091, GOZ has no money for fuel

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This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS HARARE 002091

SIPDIS

STATE FOR AF/S

NSC FOR SENIOR AFRICA DIRECTOR JFRAZER

USDOC FOR 2037 DIEMOND

TREASURY FOR OREN WYCHE-SHAW

PASS USTR FLORIZELLE LISER

STATE PASS USAID FOR MARJORIE COPSON

¶E. O. 12958: N/A

TAGS: ECON EPET EINV PGOV ZI

SUBJECT: GOZ has no money for fuel

¶1. Summary: Oil parastatal NOCZIM has been unable to

import fuel for GOZ purposes over the past week. End

summary.

¶2. The fuel shortage is affecting Zimbabweans in a

variety of ways:

– The National Railway of Zimbabwe (NRZ), a critical cog

in the country’s economic infrastructure, has cancelled

most departures. This increases freight and passenger

transport costs 3-5 fold.

– After boarding a flight, Air Zimbabwe told its Saturday

morning passengers bound for Bulawayo/Victoria Falls that

it had no fuel. They had to wait hours until the

beleaguered carrier could borrow fuel from another

airline.

– NOCZIM has cut fuel supplies for commuter vans, the

GOZ’s method of subsidizing public transport. With few

vans running, morning and afternoon commutes to high-

density suburbs can take 3-4 hours. Embassy national

employees report they must sometimes settle for rides

with dozens of others in cargo beds of trucks. Desperate

commuters literally beg motorists for rides, occasionally

blocking traffic.

Comment

——-

¶3. Since Libya’s TAMOIL halted shipments to Zimbabwe last

year, NOCZIM has been unable to offer subsidized fuel to

commercial and retail customers. Until last week,

however, the GOZ had managed to keep subsidized fuel

flowing to parastatals and, to a lesser degree, commuter

vans. The latest shortages may mean the GOZ is

experiencing greater difficulties making purchases in

hard currency, a consequence of falling export revenue.

GOZ policy discourages exports by requiring firms to

convert half their revenue at the official rate, a

current 43 percent effective tax. Land reform has also

taken its toll on export earnings from tobacco and other

crops.

¶4. The GOZ has generally prohibited parastatals from cost

recovery for services. Mostly, this policy stems from

the GOZ’s unwillingness to recognize the zimdollar’s

market exchange rate. The unsupported official rate

represents only 15 percent of the zimdollar’s market

value. Therefore, charges for international phone calls,

railway service and electricity are well below parastatal

cost. The GOZ has subsidized these public services

through export revenue, cheap borrowing (interest rates

are over 300 percent negative) and donations (especially,

fuel from Libya and electricity from South Africa).

It’s been a losing battle, and the GOZ has thus far

directed parastatals to cut services rather than price

them at or above cost.

Sullivan

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