Price hikes far from being over: Retailers

The Zimbabwe dollar has depreciated pushing prices of basic commodities up

PRICES in Zimbabwe will continue to escalate despite measures put by the government to tame them, the Confederation of Zimbabwe Retailers (CZR) has said.

The country has been experiencing price hikes over the past few weeks, forcing monetary and fiscal authorities to come up with a cocktail of measures to address the crisis.

However, CZR president Denford Mutashu told Standardbusiness that the measures will not be able to resolve this price madness anytime soon.

“It does not follow that after implementing all these measures that have been announced, we will see stabilisation of prices,” Mutashu said.

“Prices are going to escalate for the foreseeable future until the rate finds its footing and it is going to take some time before that happens. The equilibrium may happen, but it is certainly not going to happen now.

“Chasing prices is a war that we will never win. It's a scenario that will never bring stability. By the time that we're going to attain equilibrium, the suffering will actually be much more.”

He added: “I don't think at the current rate, Zimbabwean workers are able to absorb the pain.

“Market forces, demand and supply, are good in determining prices and stability in a normal market; but in our case, the greater part of the market is informal.

“So, it's an area that also has exacerbated our situation because the policies will only work to police as it were, probably 20 to 30% of the market, which is insignificant given the amount of business and activity that is taking place in the shadow economy.”

Mutashu said instead of focusing on causing more pain on the small formal market, the government needed to bring on board the shadow market while also addressing the concerns of the formal market and the general consumer.

“So far, I think consumers should actually begin to brace for more pain,” he warned.

He recommended that the government should come up with a facility supporting manufacturing, production and distribution of key basic commodities.

“On the part of the retail and model distribution, what was required from that facility was to access liquidity to enable them to procure and pay for the key basics and enable them to sell in both currencies but predominantly in the local currency because majority of our employees are earning in local currency,” he said.

“So it is very clear that if we were to do that, we would not need to disrupt the market the way that we have done because the disruption is sincerely not going to come up with anything positive.”  

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