Ministers blames social media for panic buying

HARARE - A ministerial taskforce set up to investigate the root cause of recent price hikes and panic buying is set to wind up its probe next week, with preliminary results revealing that government blames social media.

Industry and Commerce minister Mike Bimha, who is chairing the committee, said investigations had revealed that social media was the main cause and not the months-long foreign currency crisis.

This comes after government has threatened a crackdown on social media users it accused of spreading false rumours of shortages and causing panic buying of fuel and other goods.

“Some were taking advantage of the chaos and went on to increase the prices,” Bimha said.

“You ask yourself where is this coming from? Or is it about chancers? So Cabinet last week put together a ministerial task force which I chair to look into that and we have already started on that which is really short, medium and long term.”

Asked if any action will be taken against the said perpetrators, Bimha told the Daily News:  “No, it’s not like it’s a committee to arrest people, it’s a committee to make a proper study right from the issues of use of social media, because it’s not just issue of forex, yes forex might have been in short supply, but it was more of panic buying, panic buying starting because someone sent a message on social media that there will be shortages and naturally people want to cover themselves against risk and then it got out of hand.”

Zimbabwe is confronted with a deepening cash crunch that has markedly worsened in the last three months, with some banks limiting withdrawals to as low as $14 in bond coins.

A critical shortage of US dollars has left businesses battling to import goods and raw materials for manufacturing.

Prices of imported cooking oil and dairy products shot up, with businesses arguing they are forced source forex on a thriving black market at a steep premium.

Confederation of Zimbabwe Retailers president Denford Mutashu said retailers had no choice but to increase prices because foreign currency shortages were forcing them to get the elusive United States dollar from the black market at sky-high premiums.

“Retailers don’t want to increase prices. But the issue of short supply of foreign currency which has forced retailers to go on the black market to get forex at a premium has been the biggest factor.

“We have no choice but to pass that component onto the consumers but not because we want to profiteer,” he said.

Confederation of Zimbabwe Industries (CZI) urged industry players and government to remain focused on long term objectives of lifting the economy from its current predicament saying all players needed to do more to instil confidence into the market.

“The Nostro Stabilisation Fund is of course a short term measure, and we need to remain focused on the longer term issues,” CZI president Sifelani Jabangwe said in a recent update on the state of supply of goods.

“These  include further boosting exports to earn more foreign exchange, number two all players to do everything possible to instil confidence in the market, number three continue increasing the capacity of local industry to substitute imports, thereby saving valuable foreign exchange and number four, above all, reduce the fiscal deficit to manageable levels.

“…We saw a frenzy of panic buying which was taken advantage of by speculators who bought goods and resold them at inflated prices. This happened when the stocks were low, but adequate for normal consumption. The low stocks were due to low levels of foreign currency allocations for companies to import raw materials,” Jabangwe said.

“The foreign currency is generally low in the period August and March due to closure of the tobacco auction floors. The panic buying and hoarding disrupted the normal buying patterns.

“The fact that this happened over the weekend meant that suppliers who were closed could not respond to the stock outs as and when they happened…

“The RBZ has undertaken to inject foreign currency into the market through the Nostro Stabilisation Fund. This should enable industry to acquire raw materials and thus increase the supply of goods.”

Comments (2)

Lies, prices are still up, cooking oil is not readily available in shops, some goods are now not even found in most shops. Is that social media? NO NO NO, the truth is the bond note has lost value and they divert attention, and very soon traders will refuse to take bond notes, when whole ministers sit down to discuss whatsup, FAILURE!!!!!

Mwazha - 14 October 2017

Or goods will start disappearing from shelves soon.

donga - 14 October 2017

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