John Mangudya. Picture: REUTERS
John Mangudya. Picture: REUTERS

Harare — Zimbabwe’s central bank governor sought to reassure the public on Saturday as people again formed long queues to fill up their cars in Harare. Others were panic-buying basic goods such as cooking oil and sugar.

The panic has been caused by recent changes introduced by the government and a worsening US dollar crunch, but governor John Mangudya said that people should not be worried and he expected an improvement in 48 hours. "The problem is that we did not explain things. This economy is a sentiment-driven economy so we need to communicate more with the society," he said.

Zimbabwe adopted the US dollar in 2009, but a shortage of cash dollars has worsened after a disputed election won by President Emmerson Mnangagwa in July.

Fuel queues started building up last week and on Saturday outlets in Harare had either run out or had long queues as drivers waited.

At some outlets owned by Total, attendants served only motorists with prepaid cards. Other outlets refused mobile payments, preferring bank cards and cash.

Zimbabwe spends $80m a month on fuel imports.

Mangudya said the fuel shortages had been caused by an introduction of a 2% tax on electronic payments last Monday, which meant oil firms would incur weekly bank charges of $400,000 for fuel imports but were not allowed to pass the cost to consumers.

The companies had stopped supplying fuel as a result, Mangudya said, but the situation would improve in the next 48 hours because the government on Friday scrapped the tax on foreign payments.

Zimbabweans were also stocking up on basic goods such as rice, cooking oil, sugar and juice. At some branches owned by Zimbabwe’s biggest grocery chain, OK Zimbabwe, management limited sales of sugar, cooking oil and a popular juice.

"Management reserves the right to limit quantities," read a notice to customers.

A shortage of US dollars in banks has forced importers to buy them on the black market, which has pushed up premiums and the price of imports.

On the black market, the premium for the US dollar spiked to a new record on Saturday, reaching 165% from 120% on Monday, traders said.

That means buying $100 in cash via a bank transfer cost $265, up from $220 earlier.

The situation has not been helped by Mangudya’s decision early this week to order banks to open accounts for clients who earn foreign currency and separate their money from dollars in the local banking system.

Analysts said the move effectively makes the dollar surrogates Zimbabwe’s de-facto local currency.