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Oliver Kazunga, Senior Business Reporter
THE Grain Millers’ Association of Zimbabwe (GMAZ) has suspended its price monitoring programme and terminated contracts for 200 monitors after the Competition and Tariff Commission (CTC) condemned the initiative as restrictive.
The CTC recently raised fears over a possibility of some producers colluding to increase the cost of goods and services under the disguise of setting recommended price ranges.
According to an internal correspondence dated 29 July 2019 seen by Business Chronicle, GMAZ general manager Ms Lynette Veremu wrote to the association’s national executive advising of an urgent application for condonation with the CTC early this year for the setting up of GMAZ’s Costs Review Technical Committee (CRTC).
She said the measure was done to “ensure compliance by all players in the value chain through the price monitoring programme”.
Ms Veremu said this was done at the instigation of Government, which is also subsidising maize and wheat, and widely welcomed by the Consumer Council of Zimbabwe.
“This exercise is deemed by law as a restrictive measure. We later met with them at their offices and answered all their queries.
“CTC later wrote a letter on March 5, 2019 requesting for information, which we provided them with on May 5, 2019,” said Ms Veremu.
“Regrettably, they adjudged our case as not urgent and declared the function of CRTC as per se prohibited.
“In light of this hostile treatment we are receiving from CTC, I regret to advise that I have halted the price monitoring programme and the employment contracts for 200 price monitors are terminated.”
The CTC highlighted that some producers and/or manufacturers were publishing recommended price ranges, whose impact was negatively affecting consumers.
While the practice seems to be aimed at cushioning consumers from likely exploitation by unscrupulous retailers, CTC has said this was in violation of the Competition Act (Chapter 14:28), which gives the commission the mandate to promote and maintain fair competition in all sectors of the economy.
Ms Veremu said their CRTC’s mandate was to compute fair prices for maize meal, flour, rice and salt on behalf of the grain milling industry.
“This programme (price monitoring) was a joint effort of the GMAZ, Confederation of Zimbabwe Retailers and CCZ.
“In essence, the programme was well received by all value chain players namely the millers, retailers and consumers,” she said.
Ms Veremu said for the past 10 weeks they have run the price monitoring programme, prices of maize meal, self raising flour, salt and sugar stabilised and were within the range in all major shops nationwide. This, she said, has helped food security at household level.
“However, in the absence of price monitors, the prices of mealie-meal, flour, salt and rice are expected to increase in the market astronomically.
“It must be noted that CTC continue to maintain a deafening silence when prices of other key commodities skyrocket but are quick to attack the GMAZ initiative that seeks to stabilise prices,” Ms Veremu said. — @okazunga
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