Pricing madness refuses to die

HARARE - Prices of some basic commodities are continuously skyrocketing notwithstanding assurances by the authorities that the situation would soon normalise.

A survey done by the Daily News in the two major cities of Harare and Bulawayo revealed that prices for most basic products were rising in tandem with developments on the currency black market where rates are spiking.

This is likely to put pressure on incomes which have already suffered substantial diminution of value ever since the market was hit by panic buying more than a week ago.

This is at a time when most companies can hardly afford an upward review in salaries, even by margins below the rate of inflation, owing to the depressed demand for their products and services.

In fact, most companies are actually contemplating cutting back on their employment numbers because they can barely keep their operations afloat.

A survey conducted by the Daily News revealed significant price increases in major retail shops in Harare, cutting across most basic goods such as cooking oil, sugar, mealie meal and laundry soap.

Two-litre bottles of cooking oil have disappeared from the shelves of most retail outlets with only 375ml bottle available at a retail price of 85 cents per unit.

Interestingly, most of the larger quantities of cooking oil are being found at the small tuckshops in downtown Harare, with the cheapest 2l cooking oil going for $6.

Bars of green laundry soap, which used to cost $1 are now selling for $2,50, with bigger quantities of the product only available at the tuckshops on a cash only basis.

Prices of commodities such as gas have also increased with most providers of Liquid Petroleum Gas selling at $1,90 up from $1,50. Most eateries have also hiked their prices with a standard plate of sadza and beef stew now selling for $3,50 up from $1,50.

In the “City of Kings”, as Bulawayo is affectionately known, major supermarkets such as Choppies, TM and OK appear to be clawing back to the normal.

While sugar is available on the shelves at old prices, there still appears to be a challenge with the availability of cooking oil in the second city following massive hoarding of the product by panicking Zimbabweans more than a week ago.

Choppies shops in the city had no cooking oil in their shelves, while OK and TM only had 375ml, 500ml and 1litres bottle only. The shelves were also not full, a sign of the negative impact the commodity shortages have had on the retail outfit.

In one of the shops, price tags for the small cooking oil bottles were not displayed, perhaps for fear of the authorities who swooped on tuck-shops in downtown Harare on Tuesday last week with some being ordered to close after being caught charging different prices for different modes of payment.

While officials from the Reserve Bank of Zimbabwe and the National Competitiveness Commission are still to descend on Bulawayo, fear of the authorities is almost palpable in the second city.

In one of the shops in Bulawayo, a 375ml of cooking oil was going for $6,90 while the 500ml unit went for $1,30.

Unlike in the past few days, there were no signs of panic buying in the shops.

A common trend in most shops throughout the country is the use of the three-tier payment system where customers who are transacting through mobile money transfers and swipe incur an additional cost.

Reports indicate that the situation could be bad in far-flung communities where retailers feel safe from the prying eyes of the authorities.

In rural areas such as Mutoko and Murewa, consumers have complained that the prices of cooking oil rose from $3,50 to $7 while a 750 gramme bar of laundry soap skyrocketed to $3,50 from $1.

Throughout the country, the availability of fuel has vastly improved.

The long queues that had emerged last week have disappeared, a sign of improvement. While other garages are accepting swipe cards and EcoCash as modes of payment, some claim not to be connected to the system.

Economists have warned that the situation in Zimbabwe was likely to get worse before the general elections next year.

Financial research firms such as Equity Axis said the debilitating economic environment has caused the informal sector to flourish through rating Real Time Gross Settlement system, bond notes and United States dollar.

“An overrun budget, constant government overdraft demands, possible election funding demands and a doubling up of the bond notes circulating in the market are factors that have unnerved economic participation and formed expectations of a worsening economy,” they said.

Comments (1)

OLd Mtual plc price in Harare $9.64 and London $2.60. Divide 9.64 by 2.60 = 3.70 Therefore 1 US dollar is equal to mabondi notes 3.70 as of today ! Comrades - stay with the US dollar at all times if possible.I am not an economist but my grandmother who is wise & resides at kumusha advised me about the US dollar a long time ago. Seems she also understood Greshams law - pamberi to the future ma comrade

ace mukadota - 3 October 2017

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