Consumer Council report on hikes

The root cause is forex shortage. We also must be proactive to the cycle of our forex inflows throughout the year.

Our inflows fluctuate from high to low, with heavy influence from the agro sector. We need to address this by finding a tool to manage the low trough in the forex supply cycle every year (August to March), for instance, the Nostro Stabilisation Fund or, preferably, increasing national exports. (Immediately to medium-term)

There is need to promote greater growth of exports aggressively in all sectors. (Medium to long-term).

There is need to scrutinise and better allocate available forex in line with priority lists. Reconcile between banks and the RBZ. (Immediate)

As CZI, we are also looking to go on a campaign to showcase the positive effects of the various Statutory Instruments which are now under SI 122.

The actions above show that we could kill the black market within a year and assure the nation of adequate supply.

However, we must also consider that the economy is growing; the requirements for forex will keep growing as well.

With all these challenges we are going through, the economy is in a very strong state compared to most prior periods.

All challenges can be managed as long as we take well-researched interventions. With 2017 only two months from the end, we believe we could even assess how the economy has performed this year, looking at indicators such as:

1. Gross forex inflows for the country have grown by 48 percent. We have, so far, had a narrowing of the trade deficit by 26 percent;

2. Various achievements in the manufacturing sector, including new local and foreign investments;

3. Achievements in tourism such as completion of Victoria Falls International Airport;

4. Completion of the Tokwe-Mukosi Dam, achievements in agriculture such as the bumper maize harvest; and 5. Progress in the energy sector. The result of the assessment should be a positive mark, indicating that all stakeholders have done well in 2017. Mr Sifelani Jabangwe is the president of the Confederation of Zimbabwe Industries. He was speaking to The Sunday Mail’s Livingstone Marufu in Harare last week

ON SEPTEMBER 23, 2017, the Consumer Council of Zimbabwe was alerted to drastic price hikes. Concerned, we surveyed shops in Harare, Bulawayo, Mutare, Gweru and Masvingo. Cooking oil was the main product of discussion.

A week earlier, we had done a survey and established that a 2-litre bottle of cooking oil cost around US$3,50. It was pegged at as much as US$5,10 after September 23.

Everything had gone up and consumers panicked, remembering 2008.

Why this destabilisation occurred, we don’t know.

We can only base it on a social media message.

Even people selling outside shops changed prices. They were not accepting swipe. If you paid via mobile banking or Real Time Gross Settlement, there was a premium on top.

Consumers grew anxious and everybody else took advantage of the situation.

This is what we found out in our surveys: 25 September Cooking oil: It was not available in most shops visited by CCZ. Where it was available, prices had risen from US$3,50 to US$5,40.

Harare: There was two-tier pricing, US dollar and bond note. Some shops did not display prices. They took them off and one would only know of the price at the till. There were restrictions of one to four bottles per person.

Chicken cuts: These were largely unavailable. Where available, a price of US$8,60 was charged.

Eggs: These were largely unavailable most probably because of bird flu. Where available, prices had gone up from US$4 to US$7 per tray.

Flour: (The price) increased from US$1,95 to US$2,20.

Cerevita: Price increased from US$2,89 to US$3,69, but this might be due to fortification which was recently introduced to the product.

Fresh milk, lotion, dish washer, beef, pork, detergents, tomatoes, onions and baked beans also increased prices. Prices for other products remained relatively stable.

It was also observed that wholesalers were not accepting RTGS payments, mobile and digital money.

The quest for cash was then transferred to the customer by retailers.

As the week progressed, cooking oil started being available in 750ml at a price of US$1,15 19 October Cooking oil: It was now available, 2-litre bottles were ranging from US$2,80 to US$2,85. In high-density suburbs of Harare, it wasn’t available. In low-density suburbs, there were restrictions of one bottle per person.

Streets were awash with locally-produced cooking oil being sold by vendors at US$3 and $3.80 for the US dollar and Bond note, respectively. In Masvingo and Gweru, cooking oil was not available.

Shops were now displaying prices.

Chicken cuts: Now readily available at a price of about US$7,35, but in Bulawayo, it was US$7,59 to US$7,99. Local brands were mostly available.

Eggs: These were available everywhere except in Masvingo. They ranged from US$4,70 to US$5,60 per crate.

Flour: It now ranged from US$1,95 to US$2,20.

Beef and pork prices increased again from a range of US$6,19 to US$7,75 compared to 11 October prices of US$5,40 to US$6,50.

Prices for fresh milk, detergents and everything else remained stable. Tomatoes and onions increased by a small margin.

Wholesalers were still not accepting RTGS and mobile money.

Overall, local products were affected by the destabilisation of prices, but the margin was not very high compared to imported products, besides cooking oil.

Imported products sky-rocketed, especially niceties like cheese.

Things like mealie-meal hardly went up maybe because we had a bumper harvest and there was no reason for it to go up.

Prices have generally declined, but not to pre-September 23 levels.