Over a decade later, Government continues to stand ready to assist the people in the face of another wave of arbitrary price increases.
As to be expected, the price controls were not well received by some members of the business community, who deliberately removed basic commodities from their shelves, thereby creating artificial shortages. Surprisingly, the same basic commodities were found in the informal market in abundance. The basic commodities were affordable to those who had foreign currency, but the majority of people failed to access them. That caused an outcry from the public as most people were paid in local currency.
After realising that life was unbearable to the public, the Government, through the Reserve Bank of Zimbabwe (RBZ) then introduced what came to be known as the Basic Commodities Supply Intervention (BACOSI). The BACOSI initiative was meant to make available basic commodities in rural areas at reasonable prices with some being given freely to the less privileged and the needy. This initiative brought relief to the rural folk as they were able to access basic commodities from government but was not viable to the urban dwellers where the same was not operational.
The persistent non-availability of basic commodities in the formal market especially in urban areas during that period (2008 to January 2009) led the Government to introduce multi-currency basket, where people with any of the specified currency could buy products of choice either in the country or outside the country. The move was a noble idea as it would ensure that things normalised. The multi-currency regime, which was ushered in by the then Minister of Finance and Economic Development, Patrick Chinamasa, when he presented the 2009 National Budget in January 2009, stabilised the economy, thereby enabling people to live normal lives again until recently when the economy began to experience some headwinds again.
Although the current socio-economic challenges are way better than those of the 2007/8 hyperinflationary era, some businesses are back to the malpractices of the era. They have begun to arbitrarily increase basic commodity prices beyond the reach of the public again, forcing the Government to think of ways to cushion the majority from the effects of the increases.
Instead of using price controls as was the case in 2008, Government sought to deal with the issue in a different way. Last week, the Government suspended import duty for 15 basic commodities to allow individuals with free funds to import them affordably.
However, industry argued that this was a bad move, which they said reversed the gains in rebuilding the country’s manufacturing capacity. The same industry was quick to criticise the move forgetting that, while Government would be happy with a rebounding manufacturing sector, it had a duty to find solutions for ordinary Zimbabweans who could no longer afford basic commodities due to increasing prices. Industry has been increasing prices forgetting that the public did not have the buying power to match the price increases.
Government`s move to open up the importation of basic commodities by citizens through the lowering or suspension of import tariffs and other accompanying measures came as a relief to the public. This will bring in basic commodities that will be affordable to the public thereby creating competition in the market. Such a move is bound to reduce both inflation and commodity prices.
This will be achieved through competition. While not many people have free funds, those individuals who do will flood the market with basic commodities which will compete with locally manufactured goods on pricing, a battle that the latter will not win. Formal retailers will also compete with informal retail channels such as car boot, roadside markets and tuckshops. Given that most people are bargain hunters, the formal retailers are likely to lose the war to their informal counterparts.
The Government should be applauded for always being there for the people and taking appropriate measures that lessen hardships on them. People should not pay attention to the cries of the business community which, in most cases, are driven by greed and merciless profiteering.
Members of the business community should be reminded that for them to be viable, they should not make life difficult for their customers through unnecessary price increases. For that reason people should organise themselves and import such commodities in bulk to ensure that their families survive this temporary but difficult phase in the history of the country.
