Government has identified 14 basic commodities for instant
measures aimed at fostering price stability to cushion citizens from incessant
price increases, a senior Government official has said.
It also emerged last week that the Confederation of
Zimbabwe Retailers (CZR) met President Mnangagwa a fortnight ago to apprise him
on the situation regarding product supply, the galloping prices and challenges
facing businesses.
CZR says the President showed knowledge of the dynamics in
the economy, but was particularly not pleased with monopolies in the production
of basic commodities and reportedly revealed Government had a robust plan to
break the monopolies for healthy competition.
These developments come against the backdrop of the wave of
frequent price increases, since the onset of ongoing economic reforms in
September last year to realign key economic fundamentals for inclusive, faster
and sustainable economic growth.
Against this background, inflation has let loose,
sky-rocketing from a lowly 5,39 percent in September 2018 to a staggering 175,5
percent by June this year, as prices show little signs of stabilising.
In the intervening period, especially after onset of
currency reforms that saw introduction of a liberal exchange rate and interbank
market, prices have tracked changes in
exchange rates, which has shifted from US$1 to $2,5 in February to US$1 to
$15,5 currently.
This trend has partly been attributed to high demand for
foreign currency needed to import finished goods or raw materials amid little
domestic industrial and agricultural production. But certain pricing models
portray profiteering and greedy tendencies. Prior to liberalisation of the
exchange rate and interbank market, Zimbabwe had since February 2009 used a
basket of currencies, largely dominated by the US dollar, as the transaction
currency and unit of account. Zimbabwe reintroduced local currency in February
this year.
Secretary for Industry and Commerce Dr Mavis Sibanda, said
meetings were ongoing with industry and commerce to understand the challenges
they are facing and factors driving relentless price increases.
A paper will then be compiled detailing issues industry
would have outlined, which will be presented to President Mnangagwa for his
consideration and possible interventions.
However, Dr Sibanda said Government felt there was no
justification for the magnitude and frequency of price increases happening in
the country, which pointed to attempts to force the State’s hand on price
controls so that basic goods disappear from the market.
“That is a cause of concern to us as a ministry; we are not
even sleeping because we do not understand what is happening and we are trying
to find means and measures to stop this.
“We also think this is generated by people with ulterior
motives because there is definitely no reason why (for example) if the price of
fuel goes up by one cent, the price of Mazoe goes up by $10. Honestly, if one
cent can be equated to $10 or $15 then there is something wrong. I personally
believe some of these people are trying hard to push Government to put price
controls, I think this is the intention that Government should put price
controls so that goods disappear from the market.
“We will work with the business community to see how best
we can change this. It is unfortunate that the people we talk to (and) have
meetings with and seem to agree, toti tabvumirana, but tomorrow we see
something different from what we would have agreed on,” she said.
Dr Sibanda said Government, through her ministry would not
give up on efforts to ensure sanity is restored in pricing models, adding that
they have not conceded defeat. She expressed confidence that Government will
eventually triumph on the issue.
“We are working hard; we are meeting with the bread people;
all basic commodities; 14 basic commodities. Those are the ones which we are
really worried about. Things like sugar, bread, mealie-meal, cooking oil; those
are the things which we are really worried about as well as seed and
fertiliser. We are also working on a paper which we are going to give to His
Excellence, The President to say, ‘What are the people saying? To tell the
truth as much as possible to say ‘What are the business people saying?’ We all want
to get this thing (of prices increases) to a conclusion, we cannot allow it,”
she said.
Dr Sibanda was speaking during a meeting with the Norton
Business Alliance members, which included giant farm implements maker Hastt
Zimbabwe, automotive lead acid battery maker Central African Batteries, leading
cooking oil manufacturer Cangrow Trading and Non-ferrous Metal Works Zimbabwe
to appreciate their challenges.
The meeting was held ahead of a scheduled visit by Industry
and Commerce Minister Mangaliso Ndlovu to also appreciate challenges businesses
in the area are facing, which include acute shortage of power and key raw
materials. CZR president Denford Mutashu said they met with President Mnangagwa
just over a week ago to apprise him on the issues and challenges businesses are
facing and unravel underlying causes of price instability in the economy.
“Ours was quite an open and incisive meeting where we
apprised His Excellence on the state of basic commodities supply and pricing.
The President was quite informed on pricing and supply issues on products like
bread where he gave us thought-provoking insights, which we have already
started working on as a sector. The President highlighted his dismay concerning
monopolies that have a stranglehold on the economy and that Government has a
robust plan to untangle these and usher competition in the production of basic
goods,” he said. Sunday Mail
0 comments:
Post a Comment