Unions warn of unrest as Zim ups fuel prices

HARARE -- Zimbabwe's main labour federation said on Saturday it feared violent civil strife if the government does not scrap a 70 percent increase in the price of petrol announced earlier this week.

The Zimbabwe Confederation of Trade Unions also said it would call a two-day national strike to protest the hikes on regular petrol, diesel and other fuels.

In a letter to Finance Minister Simba Makoni, the federation, which represents 90 percent of the nation's labour unions, said rising inflation had already eroded the purchasing power of "struggling workers".

The fuel increases, the ripple effects of which will sharply spur inflation -- already around 70 percent -- worsened what the federation called an existing "explosive and tense atmosphere and the looming reality of spontaneous actions by ordinary citizens".

Collen Gwiyo, the federation's acting secretary general, said the group's leadership on Saturday resolved to begin preparing for a two-day strike across the country while also pressing Makoni to scrap the "insensitive" price increases.

If no progress was made in talks with the government, the strike would be held in the first week of July or possibly earlier if workers demanded more immediate action.

"We will not accept the increases," Gwiyo told reporters.

Members of the nation's 30 main labour unions would be asked to stay home.

They would also be asked not to participate in public protests or marches, to avoid violence, Gwiyo said.

A series of national strikes that the federation organised to protest economic mismanagement in 1998 led to rioting in which at least eight people died as police and troops dispersed marching workers.

Regular petrol went up on Wednesday to R11 a litre from R6,50.

Per gallon, the price rose to R42 from about R24. The price of diesel fuel used by industry went up by 67 percent.

Since Wednesday, commuter bus fares from impoverished townships around the nation's cities have been increased to make up for the more expensive fuel.

Spiralling delivery costs on mealies, the staple food, bread, milk, other foods and popular beer and soft drink brands are expected to affect prices by the end of June.

A 15 percent fuel price rise in October, accompanied by increases in the prices of bread, milk and other foods, touched off rioting in suburbs of the capital here.

The government says the recent petrol price rise was needed to bring in more money to buy foreign currency.

The forex reserve was being drained by the flourishing black market for hard currency.

The Zimbabwe dollar trades at the government-pegged exchange rate of 56 to one US dollar but the American currency fetches up to 140 Zimbabwe dollars on the unofficial market.

Many people living on the city's poor outskirts already spend a third of their paychecks on transport. The price rise is expected to increase bus fares even more.

The cheapest bicycle costs an unskilled general worker about a month's earnings -- about R720.

Zimbabwe is suffering its worst economic crisis since independence in 1980, with hard currency earnings and investment hit by political violence surrounding parliamentary elections last year, that has continued ahead of presidential elections early next year. -- Sapa-AP