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‘High prices not healthy for trade’

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LOCAL economist, Daniel Ndlela, has called for reforms in pricing for the country to regain its competitiveness.

By Nokuthaba Dlamini

Ndlela made the call at the just-ended Institute of Chartered Secretaries and Administrations in Zimbabwe (ICSAZ) in Victoria Falls on Friday after being asked why the country was lagging behind in promoting imports.

“Our pricing has been too high since 2003 and it is not healthy in the field of competitiveness in trade,” he said.

“Companies are paying too much money, while competitiveness of the country depends on the cost structure of that country. We have so many costs, which other people don’t have, for example mobile phone tariffs are the most expensive in the region, so we cannot make it, hence, manufacturers now survive in an environment where they pass on the costs to consumers, but if they want to pass on the service, for instance, across the river in Zambia, they will be beaten hands down,” he said.

“We only export unprocessed materials like gold, chrome directly from the mine into the market, but what we make here, value added, will not sell because it is (cost) too high. More so, if you look at Grain Marketing Board (GMB) their pricing is more than the price across the border, where they buy grain from farmers at $390 per tonne to sell it at $250, that demands a lot of common sense. Zimbabwe was competitive until it got spoiled, that’s it.”

Ndlela said a lot of research has been done, but there was lack of implementation and proper policy structures to support reforms.

“We have done cost driver studies and put up all the recommendations and the way forward is to reform not to talk and do nothing because talking after talking don’t make a thing.

“Government must tackle reforms. We have parastatals, all of which make loses like railways (National Railways of Zimbabwe), Zimbabwe Steel Company (Zisco) and their charge structure is too high and it will never make Zimbabwe competitive.

“We also have imports financed by a certain class of people in the form of luxurious cars, yet we there’s no food and it becomes difficult, but the trouble is that debt is both domestic and foreign through taking money from Treasury Bills, which is distressing and we cannot close the gap until we face it and we stop that kind of behaviour.”

Speaking at the same event, CBZ group chief executive officer, Never Nyembudzo said: “The bulk of money received from the central bank has not returned to the bank, but we are making available modes of transactions through mobile banking, point of sale, etc, but they need more investing to ensure that systems are available and fast for customers in an effort to mitigate the situation.”

The three-day conference was themed Surviving in a Turbulent Environment.

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