GOVERNMENT controls simply do not work, especially in a modern economy. Yet, the government has tried controls on imports. The effects were disastrous as tonnes of smuggled products still made their way into the country.
We believe that controlling the exchange rate is also not working. Real time gross settlement, bond notes and mobile balances are not equal to the US dollar — it is simply just a myth. Finance minster Mthuli Ncube knows it all too well.
Controlling the allocation of foreign currency is also not working.
In fact, the long, winding queues at fuel stations, which have become a permanent feature across the country are overwhelming evidence of that and a reflection of failure on the part of the controlling authorities.
A great deal of otherwise productive time is being lost with people spending hours just to fill up their vehicle tanks until they run out again and endure another lost man-hours in the queue.
So, when shall we have maximum production if the whole country spends days and nights in fuel queues, supermarkets queues, cooking queues, sugar queues etc.
While other serious countries in the region are debating the adoption of cleaner low carbon fuels, a whole country is at a standstill because of bureaucratic bungling, outright corruption and confusion.
The government and the Reserve Bank of Zimbabwe (RBZ) have no business dealing in fuel in the first place. It is their “intervention” which has brought us to this situation.
Energy minister Joram Gumbo should not be at pains to go on live television to claim that Zimbabwe has enough fuel supplies while the situation on the ground reflects something else.
We do not even need to hear him try to convince us that the RBZ has allocated foreign currency to (their preferred) fuel dealers like they are doing us a favour. The role of government is simply that of policy.
Private enterprise should be left to their own mechanisms of control. Let market forces of demand and supply determine who gets what foreign exchange and at what rate.
Perpetuating controls on the exchange rate and currency allocation does not make economic sense and will only make the fuel situation worse.