Sunday 21 May 2023


CONSUMERS have reacted with anger to the extortionate and unrealistic exchange rate levels being applied in the pricing of basic goods in local currency by some unscrupulous retail players in the country.

In a demonstration of sheer greed, one retail chain, Basic Supermarkets in Bulawayo, had by yesterday pegged its exchange rate at an incredible rate of US$1: $5 500, almost four times the official figure of $1 404.

Angry shoppers said shop attendants at one of the retailers’ branches in Lobengula Extension were telling them that management said the motto was, ‘ongafuniyo kayekele’ (if you can’t, leave it).

A shop attendant who will not be named for fear of victimisation said they were instructed by the employer to harness as much foreign currency as possible, hence the stance to peg exorbitant exchange rate figures, way above what most shops or even informal market traders were charging.

The decision is ostensibly meant to discourage the use of the local dollar, which is legal tender, by arm-twisting customers to transact with forex only.

“Our rate is $5 500 today and please note this is for today, we are not sure what it will be tomorrow,” said the attendant.

A survey around Harare and Bulawayo central business districts, also established that the exchange rate at retail shops varied between US$1: $1 700 and US$1: $3 200.

In Bulawayo, Oceans Supermarket was using a rate of US$1:$3 000 while Greens Supermarket had a rate of US$1:$2 600, which is what most  shops were using, although a shop along Five Street opposite Highlanders clubhouse had pegged their rate at US$1: $2 700.

However, at OK Zimbabwe and Pick and Pay shops in both cities, the rate was in line with the official rate of 1:1 404.

“We are governed by the Government position, meaning we are using the official bank rate, which also allows us to add the legal 10 percent rate difference,” said a manager in one of the retail giant’s shops in Bulawayo.

Residents have since appealed to the Government to act and bring the situation under control, noting that some retailers were clearly on an extortionist overdrive, which frustrates the entire economy.

“The situation is now beyond redemption, these shops are clearly ripping off citizens. Something must give in,” said an irate Bulawayo resident, Mr Hawulani Sibanda.

“I think it’s high time the Government stamped its authority by reining in such shops. I am a pensioner earning a paltry pension, where do I get this kind of money that these shops are charging? Honestly a dollar costing $5 500, how is this allowed? The law must take its course.”

Another shopper who refused to be named said when she raised her concerns to the shop attendants on their exorbitant rate, which she said was $4 800 to the dollar on Saturday, only to balloon to $5 500 yesterday, she was actually told to take it or leave it.

“This is madness at its worst, are we a lawless country? Government must stop this madness,” she said.

Another resident from Tshabalala, Ms Ethumetse Ndlovu said the solution probably lies in the Government adopting a one-currency system.

“I think it’s now time that we have a one currency system like other countries because as long as we have more than one currency, this madness will always be with us,” she said.

“Rates are going up every day and people like us who are vendors can’t cope anymore, I can’t even afford to pay rent and school fees at the same time,” said Ms Ndlovu.

In his weekly column carried by our sister publications, Sunday News and Sunday Mail, President Mnangagwa also expressed his disappointment at the abuse of the Government’s benevolence to allow go against internationally set standards of making it mandatory for businesses to remit their foreign currency earnings to the Central Bank.

“Let me remind our business of a few facts, some echoed in all jurisdictions globally. At law and by worldwide practice, all foreign currency earnings should be surrendered to Government, through the Central Bank, as obtained worldwide,” he wrote.

“Worldwide, businesses access foreign currency for their needs from Central Bank, through cumbersome processes and on the basis of market conditions. Here we have waived that position at law and in general practice worldwide, hoping to prop our business sector and for ease of doing business. This act of magnanimity now looks underserved,” said President Mnangagwa.

He said Zimbabwe was a multicurrency economy after a deliberate Government decision but the position was now being contradicted by business.

“Any business practice, which suppresses the use of any one currency recognized by our laws are both illegal and do undermine this unique and most favourable position, which is found nowhere else in the world. The offense gets worse when these illegal practices seek to outlaw the use of the local currency unit, itself our national currency and currency of wage earnings,” warned President Mnangagwa.

Last week Government announced that it will be conducting evidence-based research within seven days with the ultimate goal of ensuring that consumers continue to access basic commodities at affordable prices.

The research, to be carried out by the  Ministry of Industry and Commerce will be conducted in collaboration with the National Competitiveness Commission, Competition and Tariff Commission and the Consumer Protection Commission, and all other relevant stakeholders.

The Minister of Information, Publicity, and Broadcasting Services, Senator Monica Mutsvangwa, while presenting her post-Cabinet meeting report, said Government noted that consumers are being forced to buy goods that they don’t need in formal retail outlets when they pay using USD so that they may offset the change balance.

This is because the retail outlets, said Sen Mutsvangwa, are refusing to mix USD and Z$ transactions.

She said from the survey undertaken, most basic commodities are generally available both in formal and informal retail shops, although there are artificial shortages observed of some locally produced goods, especially in formal retail shops, adding that prices in the formal retail sector are relatively high in both USD and ZWL terms when compared to the informal retail sector and are thus indicative of speculative and forward pricing. Herald


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