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Rutendo Nyeve, Sunday News Reporter
THE Consumer Council of Zimbabwe (CCZ) has recommended that a taskforce be set up to investigate retailers that continue to frustrate economic stabilisation measures by defying the official exchange rate while not adjusting prices in line with the appreciating local currency.
The recommendation was made by CCZ’s chief executive officer Mrs Rosemary Mpofu in her analysis of the midterm monetary policy released last month. The mid-term monetary policy statement highlighted the recent developments in monetary sector as well as policy measures being implemented by the Central Bank in maintaining price and exchange rate stability as well as efforts to contain economic volatility.
Mrs Mpofu said while the CCZ commend the tight monetary stance pursued by the Central Bank during the first half of the year 2023 and its continuation to sustainably anchor inflation and exchange rate expectations, it was vital to note that the prices in the market have not been adjusting proportionate to the appreciating local currency.
“In fact, the price surveys indicate that most supermarkets or shops are not complying to the stipulated exchange rates. Supermarkets exchange rates are ranging from 5 100 to 8 500 with a median of 6 800 which is above the stipulated rate.
“It is recommended that a taskforce be set up comprising of key stakeholders including the President’s Office, Central Bank, Ministry of Industry and Commerce the CCZ and sectoral regulators among other members,” said Mrs Mpofu.
She said the liberalisation of the exchange rate supported by the takeover of the Central Bank’s external liabilities and the requirement for duties and taxes to be paid in local currency was a welcome development to the consumers as it resulted in the appreciation of the exchange rate and a decline in monthly inflation from the peak of 74.5 percent in June 2023 to minus 15.3 percent in July 2023. Similarly, annual inflation which rose sharply in June 2023 to 175.8 percent reversed sharply to 101.3 percent in July 2023.
“These results confirm the CCZ’s findings where the family of six basket rose sharply from $1 015 962 in May 2023 to ZWL2 567 480 in June 2023. In the same vein, broad money (M3) rose sharply by approximately 100 percent from $7 150,50 billion to $14 275.48 billion as at the end of June 2023 and this significantly contributed to the sharp increase in prices in June 2023,” said Mrs Mpofu.
Turning to banks, Mrs Mpofu said there was a need to review the pricing models and benchmark charges with those of the region or countries who transact in USD.
“There is need for banks to immediately review the current pricing model and adhere to fair business practices in line with the Banking Act, and the Consumer Protection Framework. There is also need to consider whether to benchmark our charges with that of the region or with those countries whose transactions are dominated in the USD or currencies of almost equivalent value to the USD,” said Mrs Mpofu.
Confederation of Zimbabwe Retailers (CZR) Dr Denford Mutashu urged the supply chain to comply with the stipulated exchange rate saying the wholesalers have largely complied.
“Supply chain is urged to comply with official exchange rate when pricing goods and services to allow consumers to benefit from the current stability. The retail and wholesale sector has largely complied with the law guiding pricing based on ruling official rate,” he said.
The RBZ issued a Mid-Term Monetary Policy Statement under the theme “Staying the course to price stability” as it continues to put in place measures to contain inflation and wanton price hikes that had characterised the economy. —@nyeve14
Online Reporter