THE shortage of most locally-manufactured basic commodities due to the shocking decision by President Emmerson Mnangagwa’s government to impose a blanket ban on bank lending to everyone, including the manufacturing sector, exposes the incompetence that permeates the corridors of power.
Zimbabwe is currently experiencing a sharp increase in prices for basic commodities, especially cooking oil and mealie-meal which are fast disappearing from shop shelves.
Wholesalers at the weekend were selling a case of (12) two-litre cooking oil bottles for US$80, an increase from US$53 just a fortnight ago. Some retailers are selling a two-litre unit of the product for between US$5,50 and US$7, while others have run out of mealie-meal and cooking oil. This has resulted in consumer panic and a further spike in prices. In desperation to plug the hole, Finance minister Mthuli Ncube on Saturday gave those with free funds greenlight to import basic goods to fill in the gap.
The country is heading back to the nightmare of 2008 when basic commodities disappeared from shelves and were only available on the black market and at a steep premium. Very few products were available in retail outlets such as toilet paper and soya chunks. That there is a sharp increase in the price of cooking oil amid shortages, despite the country having active producers of edible oils such as Surface Wilmar, Pure Drop, Cangrow Trading, United Refineries Limited and Willowton, exposes just how bankrupt government’s measures are.
In trying to curb the increasing shortages by allowing the importation of basic goods, government has more or less sounded the death knell for the local manufacturing sector still trying to find its feet after years of bearing the brunt of a myriad of challenges which include outdated equipment, unreliable and expensive electricity, lack of long-term funding to sustain operations.
This is the key sectors for which the government came up with the foreign currency auction market in June 2020 to provide cheap funding to enable them to increase production.
The latest mess is a manifestation of the failure of Mnangagwa’s government to consult and heed the advice of relevant stakeholders such as business before implementing bizarre measures as well as its obsession with regulating the market.
The chaos emanating from government’s recent measures only re-emphasise the need to redollarise the economy, however, temporarily, and avoid trying to control market forces. Failure to do so will result in a catastrophe.