Zim not highest in region, as Government clarifies fuel prices

In an interview, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube said revenue generated through taxes and levies imposed on gaming and gambling activities will be ring-fenced to support anti-drug interventions, including the construction of rehabilitation centres and funding awareness programmes.

Rutendo Nyeve [email protected]

GOVERNMENT has moved to correct public misconceptions about the country’s fuel pricing structure, clarifying that while Zimbabwe’s petrol and diesel costs are above some neighbours, the nation is not the most expensive in the region.

Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube told delegates at the Connect Africa Symposium in Bulawayo that Malawi currently holds that unenviable top spot.

“We are not the highest in the region. We are number two. The highest is Malawi. Our prices are very similar to prices in Kenya, by the way, if you want a real comparison,” Prof Ncube said.

The Minister outlined three structural factors driving local pump prices.

First, Zimbabwe’s landlocked status adds transport costs, as fuel arriving by ship into Mozambique or South Africa must be trucked or piped inland.

Secondly, taxes and levies amount to roughly 54 US cents per litre for diesel, a figure Government controls and has been waiving or reducing to manage costs.

Thirdly, and more concerning, the procurement price sees Zimbabwe paying between 30 and 40 US cents more per litre at the point of entry compared to regional peers, even before taxes.

“That’s why when we remove the taxes, you find that our price was still higher than others. So our procurement process should be improved,” Prof Ncube said.

On the domestic currency front, the Minister welcomed the growing acceptance of the Zimbabwe Gold (ZiG) currency for fuel purchases, saying this reflects the currency’s stability.

Addressing Middle East tensions, Prof Ncube noted four transmission channels: fuel, fertiliser, food and related products. Zimbabwe’s response has included removing taxes, maintaining strategic reserves, and increasing the petrol blending ratio from 5 percent to 20 percent, a move that has already reduced petrol prices by 15 cents per litre.

The Minister also encouraged accelerated efforts to introduce diesel blending.

He acknowledged that while fuel taxes remain an important revenue source, Government will continue using tax adjustments to mitigate energy price shocks.

With regional comparisons addressed and new measures being deployed, Government remains confident that Zimbabwe’s fuel pricing trajectory can improve through better procurement efficiency, continued blending and targeted tax relief.