Government to direct retailers to reduce prices

September 23, 2019

Government to direct retailers to reduce prices

Minister Nqobizitha Mangaliso Ndlovu

Nqobile Tshili, Chronicle Reporter

Government said yesterday that it will direct retailers to reduce prices of basic commodities to where they were before the volatile foreign exchange crisis experienced last week.

A sharp rise in the exchange rate was witnessed between Wednesday and Friday when US$1 was selling for ZW$24 from ZW$13 triggering a new wave of price hike madness. The exchange rate had by Saturday plummeted to US$1: ZW$15 but retailers are yet to reduce prices to levels before the volatile crisis.

In an interview, Industry and Commerce Minister Cde Nqobizitha Mangaliso Ndlovu said Government will direct retailers to revert to prices before the volatile crisis.

Retailers claim they peg prices against the US dollar but in the past have not reduced prices even when the exchange rate had dropped as is the case now.

Prices for products such as mealie-meal rose from $27 to $48, cooking oil from $28 to $40, bread from $6,90 to $9 and 2kg of sugar from $17,22 to 23,90 following the sharp increase in the exchange rate.

“Prices went up when exchange rate went up but the exchange rate in the parallel market has dropped hence we expect prices to also come down. It’s mainly the retailers who are fuelling this. I’ve been trying to get in touch with their representatives but they are nowhere to be seen. We will direct the retailers to reduce prices to levels before the volatile crisis,” said Minister Ndlovu.

He said the issue of speculative pricing needs the intervention of the Reserve Bank of Zimbabwe.

Minister Ndlovu said he will be engaging the RBZ on the two tier pricing system where commodities are slightly cheaper for those buying using cash compared to those using plastic money.

“For instance a bag of cement is selling for between $120 and $130 for those with cash and the price is up to $180 for swipe or EcoCash,” he said.

Cash is very scarce in the market yet illegal money changers are seen with wads of new notes, raising suspicion that they are being supplied by banks. – @nqotshili