Reduced fuel imports saves Zimbabwe US$102 million

ZIMBABWE’s fuel import bill has gone down by US$102 million, the Reserve Bank of Zimbabwe has said in its latest monthly review.

The reduction according to the central bank signifies the commodity’s reduced consumption attributed to a sharp decline in fuel.

“Merchandise imports registered a decline of 22.2% from US$458.6 million in June to US$357.0 million in July 2019. The decline was largely underpinned by lower imports of fuel, notably diesel and petrol,” the report reads in part.

During the period under review, the country’s major import sources were, South Africa 41 %; Singapore 26 %; China 8 % Zambia 4 % and India 3%.

The development comes at a time when fuel price increases have gone up by more than 1500% since January this year leaving many consumers with no choice except to cut down on consumption.

According to the central bank’s review, there has been a significant increase in exports, on the back of a slump in imports, which culminated in a significant improvement in the country’s trade balance, from a deficit of minus US$219 million in June 2019, to a deficit of minus US$58 million.

Notably, broad money supply grew by 82 % to $17.08 billion in July 2019, from $9.38 billion in July 2018, attributed in part to expansion in foreign currency accounts included in transferable deposits, owing to exchange rate depreciation.

The report adds that the growth was reflective of increases in transferable deposits, 101 %; negotiable certificates of deposits (NCDs), 87.90%; time deposits, 9.28%; and currency in circulation, 8.87%.

Added the report: “Following the increase in money supply, credit to the private sector increased from $3.35 billion in July 2018 to $5.55 billion in July 2019. This translated to an annual increase of 52.09% in July 2019, compared to 16.13% recorded in June 2019.”