By Clayton Shereni
AS consumers continue to struggle to cope up with price hikes of basic commodities, stakeholders in the Industry and Commerce sector have warned that as long there is no stable forex rating system and poor production, the price hike madness will not end anytime soon.
Many stakeholders including the Consumer Council of Zimbabwe (CCZ) have called upon government and producers of basic commodities to up their game so as to contain the ever skyrocketing prices which has weighed much on consumers.
CCZ Executive Director, Rosemary Mpofu challenged local producers to make sure that they are in-line with the law of supply and demand in the quest to address price hikes as a matter of urgency.
“For as long as we can’t produce to high levels that are expected of us as a nation, we will never put to rest the issue of price hikes. Our greatest weapon is to increase production and that is what is lacking. This is why people can take advantage and increase prices willy-nilly, and our foreign currency rates continue to differ. We need to speak with one voice as a nation, our problem is we continue to be divided as sectors of the economy and that will not take us anywhere,” said Mpofu.
Other stakeholders have blamed the upsurge on the runaway forex exchange rates which they believe has left retailers and suppliers of basic supplies with no choice but to increase prices.
Senior Economist at Labor and Economic Development Research Institute in Zimbabwe (LEDRIZ), Prosper Chitambara told Centre News that due to depreciation of local currency prices will continue to rise.
“Depreciation of the Zimbabwe dollar especially on the parallel market affects the cost of production so as long as local currency continues to lose value obviously there will be price increases,” Chitambara said.
Zimbabwe Congress of Trade Unions (ZCTU) lamented the burden which these hikes have put on the shoulders of workers whom they say are poorly remunerated and cannot afford basic commodities.
ZCTU Secretary General, Japhet Moyo told this publication that due to an unstable forex exchange rate workers now find it difficult to purchase goods since their salaries are pegged in local currencies.
“What is happening in the economy has negatively affected workers. We have seen prices increasing on a daily basis but we have noted that the forex exchange rate is not stable. Some products are now being priced in United States Dollar (US$) but many workers are being paid in local currency and their salaries are not being reviewed consistently to match the prevailing forex rates,” Moyo told Centre News.
Meanwhile, Confederations of Zimbabwe Retailers (CZR) boss, Denford Chimutashu weighed in on saying: “Suppliers and producers are now strictly demanding payment in US$ so they are supplying informal traders avoiding formal retailers that have abided by the law and continued to use our local currency.”
In a Post Cabinet briefing on May 9, Minister of Information and Publicity, Monica Mutsvangwa revealed that government is seized with the issue of price hikes and has since set up a committee to investigate the matter.
“The nation is being informed that cabinet is concerned by the spiraling prices of the 14 basic goods especially bread, flour, cooking-oil and mealie meal. The Minister of Industry and Commerce is already engaging the concerned stakeholders including manufacturers, wholesalers, retailers, and other associations on the matter. Given the urgency of the matter, Cabinet has set up a committee to quickly investigate, monitor and make appropriate recommendations with a view to bring sanity to the situation,” she said.
Government has since established a panel that will look into shortages of basic commodities in the country.
However, other economists have warned of a looming price control by government which they say will force many retailers and manufacturers to further downsize or totally stop production.