The ZIMBABWE Situation | Our
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From The Daily Mirror, 19 May
Crippling street petrol prices
Farirai Machivenyika
Black market petrol prices have skyrocketed to a whooping $40 000 a litre at some spots in Harare in the past few days as unscrupulous fuel dealers make a killing from the acute shortage of the vital commodity. A visit to one such spot – a taxi rank near the National Oil Company of Zimbabwe (Noczim) headquarters in Harare – The Daily Mirror last night witnessed black market fuel traders selling five litres at $200 000. The official pump price of petrol is $3 600 a litre. Last month, the price of petrol on the black market shot up to $18 000 per litre in Harare and Bulawayo when the shortage of the precious liquid took root. When The Daily Mirror visited a spot along Leopold Takawira Street, outlawed emergency taxi operators plying the City-Avondale route had abandoned ferrying commuters and were draining petrol to resell on the lucrative parallel market. When this reporter posed as a prospective buyer, a tout said he was willing to budge and sell a litre of petrol to him for $17 000 only if a he bought in "bulk," but insisted that the going price was $40 000. "Ndokupayi five litres ne $200 000 here blaz? (Do you want five litres for $200 000, my brother?)," he asked. He added that they were mostly dealing in petrol since it sold faster than diesel. Other touts stationed about 100 metres away from the scene of the black market could be seen making gestures to motorists in a bid to lure them. The fuel shortages have persisted despite assurances by central bank boss Gideon Gono early this month that they would end "soon." The governor attributed the shortages to lack of resources which, he said, he had been "overstretched" during the March 31 general elections. Meanwhile, commuters were stranded last night as the transport blues intensified in the city due to fuel shortages. Some operators capitalised on the situation by hiking charges well above the gazetted fares. Commuters travelling from Harare to Norton are being forced to pay $10 000 – up from $6 000 – while those going to Warren Park were paying $3 000 – up from $2 000. Glen View commuters now pay $3 000, while the Tafara route costs $7 000 – up from $2 000.
From Zim Online (SA), 19 May
Harare runs dry as fuel crisis reaches unprecedented levels
Harare - Harare was virtually dry of fuel yesterday as importers refrained from placing new orders with suppliers until Reserve Bank of Zimbabwe governor, Gideon Gono, announces his monetary policy review statement today. Fuel industry sources said importers are hoping that Gono will devalue the local dollar to attract more hard cash into the official market which they could tap to pay foreign suppliers. A devaluation, coupled with a hiking of the pump price by the government, would ensure profitability for fuel importers. Alternatively, oil firms want Gono to revive a foreign currency support facility for fuel importers that was abandoned last year amid allegations of gross abuse of the facility. "It is difficult for private players to bring in fuel at the moment. We will be forced to sell at a loss because of the exchange rates," said a senior executive with one Harare-based fuel firm, who did not want to be named. He added: "For example, let’s say one imports petrol from South Africa where the pump price is about five rand or more, which multiplies to about Z$5 000 at the official exchange rate, they will have to sell the petrol here at not more than $4 000, which is a huge loss." An official of local garage chain, Exor, said the firm’s garages had last received petrol supplies a week ago. "All our garages have no petrol and there are no indications that the situation will improve immediately," he said.
In a survey of garages in and near Harare central business district, Zim Online could find no petrol at nearly every filing station while only a handful of garages in the city’s outer suburbs were selling diesel yesterday. Most of the illegal fuel black-market traders, who usually provide a lifeline for stranded motorists, also did not have petrol. The few illegal fuel traders who had the commodity were charging 10 times more than the official pump price, as Zimbabwe’s five-year fuel crisis reached unprecedented levels. One of the fuel black-marketers operating along Leopold Takawira street in central Harare offered to sell a five-litre gallon of petrol to our news crew at $150 000, which translates to $30 000 a litre. The official pump price for a litre of petrol is between $3 400 and $3 700. Energy Minister Mike Nyambuya refused to disclose measures his department was taking to ensure fuel supplies to the country. yambuya, a former soldier, would only say: "The government is working out solutions to the fuel problem and it will be resolved soon." Zimbabwe has grappled severe fuel shortages for the last five years because the country has no hard cash to pay suppliers. Essential medical drugs, electricity, food and chemicals to treat drinking water for city dwellers are among the vital commodities in critical short supply in the country because of the lack of hard cash to pay for imports.
Sustainable Development International
Companies need to assess the financial impact of HIV/AIDS beyond Africa,” warns new report |
Friday, 20 May 2005 | |
Source: Business & Human Rights A report published today has highlighted the financial risks to companies operating in fast-growth emerging economies from the spread of HIV/AIDS. The 83-page report, HIV/AIDS Beyond Africa: Managing the Financial Impacts, is the result of a unique collaboration between F&C Asset Management, a leading socially responsible fund manager, and the Equity Research department of UBS Investment Bank, one of the world's leading investment banking and securities firms. The report notes that in 2004 estimates indicated that between 36 and 44 million people worldwide were living with HIV of which 65% were living in Sub-Saharan Africa. With infection rates as a percentage of the population hitting 39% in Swaziland, 37% in Botswana, 26% in Zimbabwe and 22% in South Africa, the report states that HIV/AIDS is still widely perceived to be an "African problem". "From a humanitarian perspective it is understandable that Africa, rightly, remains the focus of world attention when it comes to the HIV/AIDS pandemic," said Kirsty Jenkinson, Senior Analyst at F&C, "but the financial impact of the disease has the potential to be more acute in other developing, and commercially important, regions. Whilst Sub-Saharan Africa accounts for 11% of the world's population it represents just 1% of global GDP." The report raises concern about the impact of rising HIV/AIDS infection rates in four of the fastest-growing emerging economies: Brazil, Russia, India and China (the "BRIC" group). These countries cumulatively account for 42% of the global population and 8% of global GDP according to the World Bank. "Furthermore," added Julie Hudson, Managing Director, Head of Socially Responsible Investment Equity Research, UBS, "these countries are key market places for manufacturing and outsourcing and have become strategically important for many western multi-nationals. They are expected to be significant contributors to future global growth." The report states that whilst national HIV/AIDS prevalence rates appear low in countries such as China and India (0.2% in China and 0.4-1.3% in India), their huge populations mean that even small percentage increases represent significant numbers of infected people. Critically, seemingly low national prevalence levels mask the rising risks of severe epidemics in regional "hot spots". The report cites the examples of then Henan, Anhui and Sandong provinces of China where HIV was already spreading a decade ago among rural people who sold blood plasma in unsanitary conditions. In India the state of Tamil Nadu has HIV prevalence of 50% amongst prostitutes, while in Andhra Pradesh, Karnataka, Maharashtra and Nagaland, HIV prevalence has crossed the 1% mark among pregnant women. "Two key factors set HIV/AIDS apart from other diseases in terms of its implications for the financial community," explained Hudson. "Firstly, it primarily strikes working age members of society at the peak of their economic productivity and secondly, there is a long time lag between infection and illness which means the disease can remain unidentified but contagious for many years. This latter problem is exacerbated by the secrecy and social stigma surrounding the disease in many parts of the world." The report highlights lessons learned from the South African experience as the basis of outlining actions which companies operating in other rapidly developing countries should take. It notes that HIV/AIDS adversely affects company profit margins (particularly in industries where wages are a significant portion of a company's overall cost structure). A further finding is that HIV/AIDS causes a decrease in overall per capita expenditure but does not behave like a normal demand shock (spending on staple goods tends to be hit harder than discretionary spending) which puts certain sectors at greater risk. The report also notes that South African firms appear to trade more cheaply than their developed and emerging market peers, indicating some degree of South African risk premium in valuations which may factor in life expectancy. The report concludes that as the disease spreads, the economics of prevention and treatment, as exemplified in South Africa, increasingly argue in favour of business self-help over reliance on public health authorities. In particular, the authors of the report make the following recommendations to companies operating in rapidly industrialising countries such as Brazil, Russia, India and China: • Assess HIV/AIDS prevalence and the host government's response to the disease in country risk assessments for new and existing investments. • Determine actual and potential staff exposure through situation analysis, prevalence surveys and voluntary counselling and testing. • Evaluate the costs and benefits associated with intervention programmes. The authors believe that traditional accounting frameworks fail to capture the positive effect of successful intervention and instead propose a net present value (NPV) approach to valuing the impact of HIV/AIDS. • Implement, where relevant, prevention, education, awareness, wellness and treatment programmes. • Publish company-wide non-discriminatory policies relating to employees' HIV status and ensure senior management are accountable for such policies to reduce secrecy and social stigma surrounding the disease. • Report publicly to shareholders and stakeholders how HIV/AIDS is being managed. • Press host governments, international donors, multilateral organisations and NGOs to implement education, prevention and treatment policies, so as to boost the effectiveness of corporate efforts. "Both investors and companies have long been aware that investing in these rapidly developing markets carries higher levels of risk. This report suggests that assessing the potential financial impact of HIV/AIDS should form part of the wider risk assessment and management process," concluded Jenkinson. |