GOVERNMENT has admitted it has no solution to price hikes
after retailers defied an order to reduce prices of basic commodities.
Industry minister Sekai Nzenza yesterday confirmed
government was in a dilemma after some retailers completely ignored the price
hike moratorium whose net effect was to get prices of all basic commodities
reduced to the levels they were on March 25.
“The meeting we had with them (retailers) was quite
historic, because it had not happened before,” Nzenza said.
“We came to a common understating that we are living under
COVID-19 and that to continuously increase the prices was hurting the consumer.
We came to an agreement.
“However, as with all agreements, you don’t always get
compliance. We have done a survey very recently and we have realised that some
retailers have indeed gone back to the March 25 prices, others have not changed
their prices at all and others have continued to increase the prices.”
She said the only solution was to engage the private sector
again to ensure compliance.
“We need to continuously engage because this agreement was
done in good faith and we are basically saying, we are in this COVID-19
together, let us also consider what the impact is on the consumer,” she said.
Economist Douglas Kanyenze said price controls won’t work
because there would be a need to control the whole supply chain which was
almost impossible given that “most of the suppliers are outside our borders”.
“It is always difficult because you have to control, not
just the end prices, the retail prices, but you have to control the whole
supply chain,” Kanyenze said.
“You already know currently the supply chain has been
disrupted. Because of COVID-19, some of the supply chains are abroad and even
in South Africa. As a result of lockdown in these countries, you cannot easily
access raw materials.”
Confederation of Retailers president Denford Mutashu said
retailers remained committed to ensuring that the moratorium announced by
government is implemented and the consumers are given a reprieve.
“Retailers are still committed to the moratorium which was
founded in good faith to alleviate the plight of consumers under lockdown. A
common position will soon be announced that reflects the interests of all
parties involved,” said Mutashu. Newsday
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