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Days numbered for fuel barons

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The Zimbabwe Energy Regulatory Authority (Zera) is working closely with the Ministry of Justice, Legal and Parliamentary Affairs to come up with punitive legislation to rein in those flouting fuel importation and trading laws.

In an interview on the sidelines of the commissioning of electricity at Garahwa Primary School in Chipinge last Friday, Zera chief executive officer, Mr Edington Mazambani said the current legislation was not deterrent enough as some offenders were getting away with paltry fines of $400.

“There are penalties in place for those found flouting licensing conditions. We first give the offender a compliance order. If they fail to comply we seal off the place. If they continue breaching the law they are then prosecuted before the courts.

“However, the laws are not deterrent enough. The maximum fine charged so far is $8 000, but they can go as low as $400,” said Mr Mazambani.

“Therefore we are now working with the Ministry of Justice to tighten the laws,” he said.

His comments come at a time when most service stations across the country are now selling fuel in foreign currency under the pretext that they would have imported it using their free funds.

While most players in the sector claim to be importing their own fuel, truckers are still forming a beeline at Feruka just outside Mutare.

Once they secure the fuel supplies locally, they sell in USD.

The price of petrol now ranges between US$1. 05 and US$1. 20; while diesel ranges from US0.80C to US$1 per litre.

Many motorists are also complaining about the calibration of some of the USD pumps, arguing that some unscrupulous pump attendants are ripping them off by tampering with the pumps.

Mr Mazambani said: “Government allowed those with free funds to chip in the importation of fuel to eradicate shortages. It was a stop gap measure done by Government as long queues were now a common sight. “Unfortunately some unscrupulous players are taking advantage of the situation to rip-off the motoring public. This is why we need punitive penalties to address this situation.

“Not all fuel should be charged in foreign currency. The stabilisation of the local currency against the USD following the introduction of the forex auction system has resulted in some big players in the industry trading in local currency. As things stabilise even further, we expect a situation where motorists will be given the choice to purchase fuel with whatever currency they have at their disposal. Affordable fuel must be available in a currency that most people have access to.”

He added: “Government is also allocating funds to procure fuel. This has helped us in boosting fuel supplies.”

While Zera is working on the new legislation, the Zimbabwe Anti-Corruption Commission (Zacc) is seized with investigations of fuel cartels that are allegedly smuggling fuel from Zimbabwe to South Africa, Zambia and the Democratic Republic of Congo.

The fuel would have been imported from Mozambique from as little as US0.50c per litre. It is then smuggled out of the country using forged export documents to evade paying duty.

Recently, the Zimbabwe Revenue Authority (Zimra) arrested two men who had smuggled five tankers of petrol (221 000 litres) into Zimbabwe using forged papers that classified the commodity as crude de-gummed soya bean oil, which is exempted from duty.

Zacc chairperson, Justice Loice Matanda-Moyo recently revealed that the criminal activities have been going on for the past two years.

“Zacc and Zimra have been conducting the investigations. Indications are that there has been a massive and expansive operation involving the smuggling of significant volumes of fuel, mainly diesel and petrol, through a number of our ports of entry.

“Investigations carried out thus far reveal the existence of a criminal fuel smuggling syndicate involving entities that are registered in Zimbabwe and in a neighbouring country.

“This criminal project has been in operation for a period of two years and its activities have caused financial prejudice to the Government of Zimbabwe and that of the neighbouring country,” said Justice Matanda-Moyo.

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