The novel virus COVID-19 has shocked the whole world and brought both vibrant and ailing economies to a grinding halt. Businesses, big and small, are struggling to stay afloat globally. Zimbabwe has not been spared by the impact of Corona virus. While there have been 9 confirmed cases and 1 death from COVID-19 as of April 6, 2020, the President of Zimbabwe introduced measures that are meant to combat corona virus and hopefully reduce the chances of any further infections in the country.
Most Zimbabweans use Public Transport as the primary means of transportation to and from home, work, school, church, and many other social and economic activities. Public Transport has been identified as a potential hotspot for new corona virus infections. As such, the government has recently announced a lockdown and all public transport operators will not be allowed to operate during lockdown, except for ZUPCO. These preventative measures are primarily meant to encourage physical and social distancing. Public Transport Operators, both formal and informal, have unexpectedly found themselves in a worst-case scenario for the businesses, they must halt their operations during the 21-day long lockdown period. This presents a major challenge for Public Transport Operators; whose businesses depend of the movement of people. This 21-day long lockdown period means Operators will not generate any revenue, and this will affect the remuneration of their employees. Unfortunately, the Zimbabwean government has yet to offer any plans for protecting small businesses, let alone informal public transport operators, from the risk of bankruptcy and collapse.
Pre-existing Challenges.
While COVID19 has presented new challenges to the Public Transport Industry in Zimbabwe, Operators and Drivers in Zimbabwe had already been facing a host of challenges that will need to be addressed when the COVID19 epidemic has been dealt with. Zimbabwe has been experiencing a tremendous economic crisis for the last 20 years and as a result, small to medium businesses were already struggling to remain afloat. The transport industry is one of the sectors affected by the crisis. Transport plays a crucial role in connecting people, transporting goods and services and fostering sustainable development. Urban productivity is highly dependent on the efficiency of its transport system to move labor, consumers, and freight between multiple origins and destinations.
Road transport is the most dominant mode of motorized transport in Africa, accounting for 80 percent of the goods traffic and 90 percent of the passenger traffic on the continent (UNESCO, 2009). In Zimbabwe, most people use commuter omnibuses daily, but, the commuter omnibus operators are faced with a myriad of challenges.
Fuel Shortages
Fuel shortages constitute one of the major challenges as fuel is an integral component in the transport business. Long winding queues of cars, commuter omnibuses, and conventional buses have become the order of the day at few service stations that are selling the commodity. In Zimbabwe, fuel shortages have made some of the transport operators to close their businesses as most of them spend a day or two queuing for fuel. Fuel, as one of the economic drivers, is an essential commodity in the transport business. On average, an 18-seater kombi works for about ZWL$300- $500 of revenue per day after removing the fuel expense. If it then spends the whole day queuing for fuel this means that an average of 50% daily revenue is lost. This, then means that operators would not be able to offer meaningful salaries to their employees as they take 20-25% as their commission monthly. When a business is paying out through commission, there is need for a constant operation.
Even though there are fuel shortages the Reserve Bank of Zimbabwe (RBZ) recently instructed (ZERA) to register all fuel service stations that have free funds, which they can use to import fuel for sale in foreign currency. This alone has a very negative impact on the operators who charge in the local ZWL currency and yet they must change it to forex so at to access fuel. Getting forex is a challenge in Zimbabwe as it is inaccessible on the formal market. Forex can only be accessed on the parallel market (black market) albeit at abnormal rates. Currently, the formal market is rate is at US$1: ZWL25 while the parallel market is at around US$1: ZW:38. The difference is unbearable, however, Operators have no option but to look for forex in the black market for the sake business continuity. Furthermore, most motor spares retailers are selling vehicle parts exclusively in forex. This does not provide a level ground to the transport operators as they cannot access spares using the local currency (ZWL) which constitutes over 90% of their revenues
Poor receipting and accounting practices
There is a culture of poor bookkeeping among Public Transport Operators. This lack of transparency exposes their business to corruption, embezzlement by drivers and outright theft. Public Transport Operators struggle to track and record key metrics such as the number of daily trips and the number of commuters picked up per trip. Without being physical there on the trip, owners of public transport vehicles have no way of knowing how much revenue was collected by drivers and conductors.
While there is a proliferation of fintech, mobile banking apps, mobile money and digital currency in Zimbabwe that include Ecocash, OneMoney, Telecash, EasyCash, and BitCoin, many Public Transport Operators have struggled to take advantage of transparency that comes with digital payments. This is another problem that negatively impacts their business and they cannot offer service to customers who are willing to pay electronically. The major Mobile Money operators in Zimbabwe (Econet and Netone) work in a parallel mode. One cannot pay for a OneMoney (Netone) service using Ecocash mobile money. However, ZUPCO has managed this by using TapCard, an electronic card that utilizes Near Field Communication technology, but this remains a challenge to the independent operators especially those operating in small scale. Operators highlight the need to have a payment platform that will accept all digital payments, from the bank and mobile money transfers
Poorly Maintained Roads and Infrastructure
The decay of the Zimbabwean economy in the last 20 years has not spared key infrastructure. The building of new roads between cities, towns and rural areas has significantly slowed down over the last 20 years. Poorly maintained roads have been a characteristic of most trunk roads and major roads within cities. These poor roads have oftentimes been blamed for causing car accidents. Many accidents attributed to these potholes in roads have been reported in Zimbabwe. Statistics released by police in 2016 indicated that roads have become death traps with an average of 2000 people dying each year (Herald Newspaper, 25 April 2016). Thus, many operators lament on the poor states of roads as they contribute to road traffic accidents. Besides causing accidents, operators also indicated that their vehicles are also at risk as they would require service before time. Public Transport Operators are some of the most affected motorists, since it is their core business to move people and goods from place to place.
Apart from poor roads there is inadequate infrastructure that makes conducting business for Public Transport Operators very difficult. There are very insufficient Bus Stops and Bus Stations. In most urban areas most commuters are now used to using informal bus stop. These informal bus stops are places that are usually associated with landmarks. A church, a school, a big tree, a hump, a stop sign, a big rock on the side of the road, an informal market or a shopping complex, these are some of the landmarks that become bus stops. This is just some evidence of the lack of enough Bus Stops for commuters and Public Transport Operators. Most cities have Bus Stations, but these have also proved to be too few. This makes it even more difficult for Operators to pick up commuters in city centers across Zimbabwe
Introduction of ZUPCO and the Public Transport Subsidy
The introduction of the Zimbabwe United Passenger Company (ZUPCO) subsidy by the Zimbabwean Government has been termed the “ZUPCO crisis” by many informal Public Transport Operators. In 2019, the government decided to reintroduce mass public transport by subsiding its parastatal (ZUPCO) so that commuters can pay much affordable fares. With the subsidy put in place, independent commuter operators are faced with a price competition challenge. Since ZUPCO is subsidized, its prices are almost 2 times less than what the independent players are charging. Currently, private transport operators are charging between ZWL$7 for between 15 and 25 km around Bulawayo while ZUPCO is charging between ZWL$2 and ZWL$4 for the same distance. One of the operators indicated that they used to do an average of 12 trips per day, but they have dropped to 6 since the introduction of ZUPCO.
Besides the subsidy issue, Operators lament the selective application of the law by law enforcement and regulators as some of the commuter omnibuses can operate without certificates of fitness and other legal requirements. Most of the operators highlight that traffic law enforcers are biased when enforcing road traffic and passenger transport regulations. Operators indicated that for instance, a ZUPCO omnibus licensed to ferry a maximum of 15 passengers is being permitted to ferry up to 18 passengers by traffic Police officers thereby endangering the passengers.
From the aforesaid, it is evident that the transport industry has been hard hit by the COVID19 epidemic. Encouraging people to stay home and actively practice social distancing might be the most effective measure in preventing the spread of the virus. Reducing the number of Public Transportation vehicles that can move people around in cities and rural areas will cut off the primary means by which people move. We are yet to see what this will mean for the Public Transport Industry going forward but informal and formal Public Transport Operators are reeling from these measures and other pre-existing problems that have plagued them for more than a decade.
Written by Dumolwenkosi Dube and Hope Ndhlovu
