‘We’ll withdraw your licenses’
AS THE Confederation of Zimbabwe Retailers, we have been assessing commodity prices countrywide. We understand prices have been going up steadily over the last six months at a rate of about 7, 7 to 15 percent.
We sought to find out why because we continued to get complaints from customers and confederation members.
So we engaged suppliers who indicated that they were facing foreign currency constraints. They also indicated that most of their raw materials were being imported.
That import component is actually the major driver of foreign currency demand among suppliers. We then wrote to Government through the Office of the President and Cabinet and the Reserve Bank of Zimbabwe Governor, Dr John Mangudya.
Dr Mangudya responded swiftly by calling a meeting.
We invited a cross-section of suppliers and players in the retail and wholesale sectors, and highlighted to the Governor what we felt needed to be done urgently.
A number of suppliers, including oil processors, needed foreign currency.
The RBZ’s quick disbursement of foreign currency was something we continue applauding as we then managed to bring in the required raw materials.
We highlighted cooking oil and fuel availability.
Long fuel queues send a wrong message to the general public, so this was an area we spoke to Dr Mangudya about.
A message I will continue to send out there is that Zimbabwe will never go back to the 200⅞ hyperinflation era.
On September 23, we woke up to serious price hikes of up to 200 percent. We were shocked. Products that had been selling at US$2 suddenly went up to US$10.
For example, the price of a bottle of cooking oil that had been slightly above US$3 shot up to US$8.
After engaging suppliers and President Mugabe’s statement on his return from the United Nations General Assembly, some prices declined.
However, we noticed that some people were raising prices marginally. For instance, one would reduce a price to, say, US$0,60 and not the original US$0,40. This is a multi-currency economy dominated by the United States dollar. Any price increase, even by a cent, is quite significant.
Presently, cooking oil prices have been reduced from US$8 to US$5 per 2-litre bottle. This is still very high as one can buy two bottles at the same price in South Africa.
We are appealing to all those profiteering to stop speculating. This is our country; we have an obligation not to short-change our consumers.
We want to commend the Industry and Commerce Ministry for continuing to engage industry and retailers to come up with a win-win situation.
Business does not want price controls, but there is need to act responsibly.
This has been the message from Government, too.
How do you explain that motor vehicle tyres that were being sold for US$76 on September 22 are now being sold for US$230? It is not justifiable.
A lot of price increases that we see now are unjustified.
The other issue is that the country has embraced plastic and mobile money, and that is noble. However, we have also seen that certain players are taking advantage to charge extra. We have visited a lot of mobile money booths that are doing this. This is retrogressive. We have been advocating plastic money alongside the Reserve Bank of Zimbabwe. We do not want a situation where customers lose confidence in plastic money.
Some people are not displaying prices, and that is an offence.
We are going around, taking down names of retailers charging speculative prices. We have forwarded their names to Government and the Financial Intelligence Unit of the RBZ.
We are considering drastic action, including withdrawing their licences.
As a nation, we need to get a stage where we call a spade a spade.
Even those who are not banking also feature on the list we have submitted to Government. We know them and have made recommendations concerning these individuals.
We have to work with Government to ensure we come out of this situation.
We are not going to defend defiant retailers, but defend the turf of retailers who are doing well; who have the cause and concern of the economy and consumers at heart. Charging abnormal prices is totally unacceptable.
Fortunately, consumers have been very helpful in giving us a lot of information. Last week, we toured Midlands, and established that there was no multi-tier pricing in shops.
It is important for Government and industry to visit other areas so that we do not make policies based on Harare alone. We have to engage. We have been to Manicaland, Masvingo, Midlands, Mashonaland Central and Mashonaland East engaging retailers and most of them have complied. Now we are in Matabeleland. In Beitbridge, some retailers were complaining that individuals were smuggling goods from South Africa and selling them illegally in the streets at low prices, making it difficult for them to compete.
So, that engagement is really important because some retailers might not have information.
For example, some admitted to increasing prices just because their peers in Harare had done so.
One other recommendation we have made is that Zimbabwe has largely gone informal, yet we have not done enough to capture that informal sector.
We are losing a lot of money because most SME players do not contribute anything to the fiscus, and we continue knocking on the doors of formal businesses.
So, we run the risk of running down formal businesses. What is required now is a policy to coordinate these two. Mr Denford Mutashu is president of the Confederation of Zimbabwe Retailers. He was speaking to Sunday Mail’s Debra Matabvu in Harare last week