Staff Reporter

Government has dismissed social media reports claiming that a hostile environment, characterised by rampant informal sector activities and poverty, is the primary reason behind the struggles faced by major retail chains such as OK Zimbabwe.

The reports circulating online suggested that the growth of the informal sector and the alleged widespread poverty have led to a downturn in formal retail, with businesses struggling to compete.

However, Government officials have rejected these claims, attributing the challenges in the retail sector to other factors, including illegal trade and smuggling, rather than the informal economy.

“Such claims are misleading and do not reflect the full picture of the retail sector’s challenges. While informal trade does play a role in the broader economy, it is not the sole cause of the difficulties faced by formal retailers. Smuggling and the influx of illegal goods into the market have been major contributing factors to the struggles in the retail sector," said the Minister of Industry and Commerce, Mangaliso Ndlovu.

Retailers are encouraged to innovate and adapt to the changing economic landscape rather than placing blame on external factors.

“We urge retailers to focus on improving their business models, customer service, and product offerings. The retail sector has the potential to thrive if the right steps are taken," said Ndlovu.

Government has been intensifying efforts to curb smuggling and illegal trade, which undermine the formal economy and create unfair competition.

Recent incidents, such as the looting of goods from a Zimbabwe Revenue Authority (ZIMRA) truck in Beitbridge earlier this week, have highlighted the scale of the problem.

“We are fully aware of the challenges facing retailers, but they cannot be attributed solely to poverty or the informal sector. Smuggling and illegal imports are far more damaging. Recently, we had a challenge with buses meant to transport passengers being repurposed for smuggling operations, facilitating the flow of untaxed goods into the country. We are committed to enforcing customs laws and ensuring that trade is conducted legally," said Acting Police Officer Commanding Beitbridge, Superintendent Philisani Ndebele.

Authorities have called for more cooperation from both the public and private sectors to tackle these issues and protect the integrity of the formal economy.

While the retail sector continues to face challenges, the Government remains committed to stabilising the economy and ensuring that formal businesses have the opportunity to grow and compete fairly.