Fuel prices vs the economy.

THE order by government for all fuel dealers to reduce fuel prices by at least 20 cents  following a massive 60% drop in international prices of oil is a welcome development which must be implemented promptly.

 Sadly, the directive came a little bit late, and one wonders why it took government ages to implement such a measure when other progressive countries had already reduced their oil prices. It is unfortunate that the hyper-inflationary environment in which Zimbabwe lived for a long period of time created a tendency to profiteer.

It must be pointed out that this stance must be adopted not only in the case of fuel, but other goods and services whose charges remain high on the local market even when the prices would have been reduced significantly on the international market

 There is need to deal with the mindset that has clogged many Zimbabweans who now believe in ridiculous profits which are often unjustifiable.

This complex goes back to the time when the economy went haywire with galloping inflation. But now dealers need to appreciate that things have changed somewhat and we are now in a new financial dispensation marked by dollarisation.

It’s quite unfortunate that because of too much speculation, the US dollar that now dominates local transactions appears to have lost its true value because people are still obsessed with the many digits that characterised the local currency before its demise in 2009.

While we cannot encourage government to re-introduce price controls, there is need for entrepreneurs to be closely monitored so that they do not unfairly charge exorbitant prices that cannot be justified and whatever circumstances.