Zimbabwe cash crunch forces Fastjet to scale down flights

Source: Zimbabwe cash crunch forces Fastjet to scale down flights | IOL  28 November 2016

Harare – Budget airline operator Fastjet – which has stopped flights between Johannesburg and Victoria Falls – has cautioned that online purchases for tickets from Zimbabwe are curbed at $200 (R2 815) owing to the continuing cash crunch in the country.

Zimbabwe is battling for foreign currency and a liquidity crunch is threatening to cut fuel and electricity supplies, as well as commodities in shops.

Travel agents and other companies in the tourism industry are advising travellers to Zimbabwe to carry with them sufficient cash as banks often run out of bank notes.

“Service frequency between Harare, Zimbabwe and Johannesburg, South Africa, has been increased, while services between Johannesburg and Victoria Falls, Zimbabwe, will be suspended as from next month,” Fastjet said on Friday.

Rationalise

This has been a result of the group’s “continued process of assessing its route network”, and its bid to rationalise routes to “match supply levels with demand” in the markets.

The developments at Fastjet have come in light of mounting cash shortages in Zimbabwe that have seen banks being asked to curb Visa and Mastercard transaction values at about $200 per day.

Zimbabwe is encouraging the usage of electronic payments and mobile money, but has imposed restrictions on bank card usage, even when travelling outside the country.

Fastjet has informed travellers wishing to book tickets using credit cards that transaction values are now curbed. “Zimbabwean Visa/Master Cards for online purchases above $200 may not be processed as a result of the current financial situation in Zimbabwe,” it said.

The company, looking to boost its operations through a fresh capital raising exercise, has also announced the resignation of non-executive chairman, Colin Child. Fastjet chief executive, Nico Bezuidenhout, will assume the vacant post and handle both positions until a replacement is appointed.

With the traditionally lucrative festive season beckoning, Fastjet executives are anticipating a surge in the volumes of travellers between Zimbabwe, Tanzania and South Africa to drive revenue generation.

“The remaining routes within Zimbabwe and Tanzania, and between these countries and South Africa, are all projected to positively contribute to fixed cost during December 2016,” it said.

COMMENTS

WORDPRESS: 4
  • comment-avatar
    ZimJim 5 years ago

    Let me guess…. The National Carrier doesn’t accept the National Currency (Bond Notes)

  • comment-avatar

    Its now in the final stages of complete collapse. Unlike plastic money, which is simply a balance transfer between accounts, Visa and Mastercard have to be backed by real money.

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    Keith 5 years ago

    You’re spot on Andy. Unlike what most people think, the bond note is not the real problem we are facing since we are insisting that the US dollar is the functional currency in Zim. The real problem is the fake US$ we created (by making the US$ a functional currency) that is circulating in the banking system. This money works within the country but not outside. In other words its not fungible because it’s not backed by any real value/or currency reserves within or outside the country. Some estimate that there is over $4bn of this money circulating in the Zim banking system. In other words, we created our own version of the US dollar which we think is the real dollar yet it’s actually the Zim dollar. The bubble will burst soon and people’s bank balances will be massively devalued.

  • comment-avatar
    chops 5 years ago

    simple ;day light robbery we are going to left with newspapers us dollar is gone papa