Zimbabwe: Gas stations reject cash as currency becomes worthless

Fuel supplies in Harare have all but dried up after service stations refused to accept the country's wildly unstable currency in payment. A handful of outlets in the Zimbabwean capital were serving drivers for local currency at about Z$150,000 a liter, roughly five times the price of fuel a month ago. Black market currency trading, which has almost overtaken the formal banking sector, began petering out as the exchange rate for the US dollar began to double almost every day. Last week international aid organizations operating in Zimbabwe gave warning that the country's economy was heading for full-scale collapse, with the currency becoming unusable and shops and services shutting down. After decades of reckless economic mismanagement -- including an official policy of printing money as fast as it can be done -- dictated by President Robert Mugabe, Zimbabwe has lurched into hyperinflation in the past few months. Annual inflation in May was at 4,500 percent, according to official statistics, which are regarded as very conservative. "This indicates we are on the slippery slope and it's coming to an end now," John Robertson, an economist, said. "It's an accumulation of things for which the government has no answer. It cannot 'discipline' the economy like it does its people." Fuel dealers said that they could no longer predict the value of the Zimbabwe dollar for more than half a day. "On Friday morning it was at Z$90,000 to US$1," said a petrol dealer, who asked not to be named. "By lunch time it was at Z$100,000 to US$1. At the end of the day it was Z$120,000 to US$1. "By the time I've banked the cash, it's lost its value and I've lost money. I've got fuel, but not for Zimdollars. I'm going to have to close my doors." The local prices of fuel, set to match the cost of importing petrol and diesel, are approved each Friday by a government committee. "They can't approve it fast enough," a service station owner said. "A lot of us are scared of going to jail or being closed down if we charge above their figure." As the fuel situation tightened, the fleets of commuter minibuses that carry Harare's workers, traders and school children from the poor townships pushed up their fares by 50 percent, after a 25 percent increase last on June 14. "We cannot afford this," Chipo Nyatsanzwa, a clerk, said. "I never thought it would get so bad." This month Harare Central Hospital, the biggest in the capital, came close to shutting completely when nurses stayed away because they could not afford the bus fare to work. Last week the country's security companies announced that "most employees" in the industry had resigned because they could no longer afford housing, transport or food. President Mugabe blames the increases on profiteering and "illegal sanctions" that he claims have been imposed on Zimbabwe by the West in its alleged rush to bring about "illegal regime change" and have him replaced by a British colonial government run by black "puppets."