Last Updated: Thursday, 19 December 2002
US$15m fuel ordered
Herald Reporter
NOCZIM has ordered fuel worth more than US$15 million to ease shortages over
the Christmas and New Year holidays.
Breaking his silence over the fuel crisis, the Minister of Energy and Power
Development, Cde Amos Midzi said yesterday that Noczim had bought fuel worth
US$10 million from IPG of Kuwait.
This was in addition to a consignment worth US$675 000 from Sandstone, a
Mozambican oil company and liquefied petroleum gas worth US$740 000 from
Sasol of South Africa.
He said the country�s sole procurement agency had paid Engen Petroleum of
South Africa US$4,585 million for fuel supplies to Zimbabwe�s southern region.
"We are going through a difficult time in terms of the availability of foreign
currency to enable the country to procure adequate stocks of fuel," he said.
Historically, at this time of the year, he said, the tobacco trading period would be
over and this reduced foreign currency earnings, which the country needs to
import fuel.
There were competing demands for the limited foreign currency available in the
country.
Cde Midzi said the Government was prioritising the importation of maize and other
basic foodstuffs to alleviate starvation.
"The Government has been making efforts to acquire grain to feed the nation," he
said.
"It is understandable that these issues have come to the fore because of the
pressures . . . waiting for long hours in queues. I�m aware that tempers do rise."
He outlined all the country�s window facilities for buying fuel.
The facilities include the Libyan deal.
Libya agreed to renew a US$360 million facility for Zimbabwe to cover the import
of fuel for another year.
This facility would deliver quarterly tranches of US$90 million as apart of a trade
investment and fuel supply agreement.
Under the deal, it was agreed that Libyan international oil supplier Tamoil will
supply fuel to Noczim and be paid in local currency which would be deposited
with the Commercial Bank of Zimbabwe.
Zimbabwe would offset this through a commodity trade arrangement in which it
would sell coffee, sugar, tea, tobacco and beef to Libya.
"Because of the reality on the ground, it has become difficult to fulfil this," Cde
Midzi said.
"We did not have enough sugar, tobacco and we have not been able to meet
Libya�s meat requirements."
However, he said, Zimbabwe had started to export beef to Libya although this was
below the expected quantities.
Apart from the country�s failure to fulfil part of the Libyan deal, he said industry
had not been willing to export to Libya arguing that it was not lucrative given that
the goods were being sold at the official exchange rate.
"With the existence of the parallel market, companies are finding it not profitable to
export to Libya," he said.
"This has militated against this (Zimbabwe-Libya) deal."
Cde Midzi expressed optimism that the Zimbabwe-Libya deal would remain alive as
Zimbabwe was making efforts to export tea and explore other areas in which
concessions could be made.
"A 10-member Libyan delegation came into the country to assess the quality of
our tea," he said.
"We may be able to start exporting tea to Libya soon."
"I�m confident that the Libyan deal will succeed. There is commitment on the part
of the Libyans and on the part of Zimbabweans to see that the deal succeed.
"We have to explore other commodities and look at other possible areas in which
Libya can invest in," he added.
IPG supplies 30 percent of the country�s requirements and has allowed its fuel to
be pumped from Beira to Msasa Noczim depot even before it is paid for.
This, he said, made it easier for Noczim to access the fuel.
Under the Petronas-Engen Malaysia deal, southern parts of Zimbabwe are
supplied with fuel products by Engen of South Africa.
"It�s a facility we are depending on and we have drawn and utilised 50 percent of
the facility," Cde Midzi said.
Asked why he had remained silent over the fuel crisis which had almost grounded
the country, he said, he had preferred to do his work and do less talking.
"I decided not to speak because I felt that it was better to spend time doing my
work," he said. "We were confident that the situation would improve."
"It was a question of the credibility of the Government � we didn�t want to take
people for granted. We wanted to be sure that the situation would improve before
we made comments," he said.
Giving a statement on the crisis would have triggered panic buying which would
make the situation uncontrollable.
Turning to the sensitive issue of fuel price increases, he said, extensive
consultations had to take place before a decision was reached to effect any hikes.
He said Zimbabwean fuel was the cheapest in the region.
"The parallel marketing structure has distorted the pricing structure in this
country," he said. "A litre of Coca Cola and bottled water now cost about three
times more the price a litre of fuel."
But price increases on fuel had an inflationary effect on the economy. "There are a
number of factors that we need to consider before we decide whether to increase
or not and when to increase."
The Government, he said, would not just hike the price of fuel as it had a social
and political responsibility to the nation.
Cde Midzi denied reports that US$16 million meant for fuel purchases had been
abused and diverted to other activities.
"There was no cash that was involved," he said. "It was a credit facility and not as
it was reported by ZBC and the Herald."
"ZBC and the Herald went to town with it � giving the impression that the US$16
million was abused by Noczim."
He said Noczim had transferred US$10 million to IPG to buy fuel which was
expected to flow into the country in a few days time.
"No cash was involved and there was no abuse," he said.
He denied allegations that relations between Noczim and CBZ had gone sour.
�Noczim has a relation with a number of banks in the country," he said. "Noczim
works with the Jewel Bank � their advisor to the Libyan deal. It has an account
with CBZ."
Noczim also has long standing relations with Zimbank, NMB, Trust Merchant
Bank and Royal Bank.
However, it also emerged yesterday that Noczim paid NMB $20 billion and Royal
Bank $2,5 billion under separate deals in which the two banks would help broker
fuel deals to the tune of US$180 million and US$30 million respectively.
"There was a failure and this could not get off the ground," Cde Midzi said. "This
collapsed."
He said Noczim has since demanded that NMB pay back its $20 billion and Royal
Bank its $2,5 billion.
"NMB has refunded the money and there are discussions for the interest. The
same goes with the Royal Bank," he said.
He also denied allegations that Noczim was hoarding fuel in order to arm-twist the
Government to raise the price of fuel.
"Noczim is a Government company, wholly owned by the Government," he said.
"Noczim cannot do anything to arm-twist the Government. It never hoarded any
fuel. I don�t think they can connive to hoard fuel."
He said the creation of Tamoil Zimbabwe a joint venture between Tamoil Africa
and Noczim was now at an advanced stage.
He said all the necessary arrangements to set up the new oil entity had been
finalised.
More than 15 sites have been identified to set up service stations which would be
run by Tamoil Zimbabwe.
"It�s a joint venture company," he said. "We have made some progress.
He said Tamoil had appointed some local lawyers to finish the incorporation of
Tamoil Zimbabwe.
Cde Midzi allayed fears that Libya would soon control Zimbabwe.
"I�ve heard about this from genuine Zimbabweans and detractors who are
anti-Zimbabwean," he said. "Libya just like any other foreign country has the right
to invest in Zimbabwe.
"If it was America, Britain or South Africa they would not raise these things �
why can�t Libya be allowed to do the same? It�s neither here nor there."
~~~~~~~~~~~~~~~~~~~~~~~~
"Ivinicus factus sum veritabem diceus." ( I have become an enemy for speaking the truth ) St Paul!
~~~~~~~~~~~~~~~~~~~~~~~~
Mitayo Potosi
_________________________________________________________________
MSN 8 helps eliminate e-mail viruses. Get 2 months FREE*. http://join.msn.com/?page=features/virus
