By Mako Jerera
The Minister of Industry and Commerce, Honourable N.M. Ndlovu, updated Cabinet on the current status of prices and availability of basic commodities following the Monetary Policy Committee’s resolutions on Friday, 27 September 2024.
These resolutions were made in response to the widening gap between the official and parallel exchange rates, which contributed to a rise in ZiG-denominated prices.
In a presentation yesterday during the Post-Cabinet press briefing, the Minister of Information, Publicity and Broadcasting Services, Honorable Dr Jenfan Muswere said, the ZIG prices of basic commodities in the formal retail outlets had increased in response to the adjustment of the local currency.
Government, however gave assurance on regular monitoring and stakeholder engagement to ensure continuation of market-relevant interventions and that a number of measures had “been put in place to support the formal sector,” Minister Muswere indicated.
Hon Dr Muswere highlighted that limited basic commodities, including cooking oil, mealie-meal, bread and sugar, were available in the informal sector, indicative of unwarranted profiteering in the informal sector.
“This situation is linked to arbitrage, as informal traders take advantage of exchange rate differences, with some cases of hoarding reported in the formal sector for re-sale to informal outlets. It is also evident that most suppliers have reduced supplies to the formal sector and are channeling them to the informal sector. However, critical to note is the fact that there are no major shortages of basic commodities in the formal retail sector,’ Dr Muswere said.
The Minister added that prices of the commodities in US$ terms in both the formal and informal outlets have remained stable, despite that both the ZIG and US$ prices were still on the higher side in the formal retail outlets, “indicating an element of forward or speculative pricing and benchmarking against the parallel market rates,” Dr Muswere concluded.
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