Without any doubt, retailers have hiked prices of basic commodities to alarming and shocking levels. Prices of most basics — rice, meat and other products — have more than doubled in the past weeks.
And something certainly has to be done to curb this deepening crisis. But the crisis can only be curtailed by addressing its root cause.
While there are rogue retailers notorious for unjustifiably increasing prices to profiteer and self-enrich, the mounting inflationary pressures are a manifestation of deep-rooted, long-standing problems the authorities have failed to address.
The crisis is not happening in isolation. For a long time now — before former president Robert Mugabe’s departure, Zimbabwe has been failing to attract investors to revive its dying industry.
And the ripple effect has been poor exports, which saw low foreign currency earnings.
Due to the foreign currency shortages, which monetary authorities have sadly failed to curb, despite introducing the unique bond notes — a currency surrogate and purportedly valued at par with the United States dollar, desperate businesses have turned to the illegal black foreign currency market.
But doing business on the black market comes at a huge price — businesses are charged punitively steep premiums to secure the scarce foreign currency.
In turn, the desperate businesses have shoved the burden of increased production costs on the hapless consumers by simply increasing prices.
Addressing the prices crisis needs the government to deal with the root cause, not the symptoms.
Government must ensure that the fundamentals are right first.
The move to impose price controls or monitoring — to be enforced by the National Incomes and Pricing Commission, which is now headed by Vice President retired General Constantino Chiwenga — will only worsen the situation.
We have walked that path before and have seen how disastrous it ends up — supermarket shelves end up empty.
Apart from dealing with the root cause, if government is serious about getting to the bottom of this, it must also expose those alleged rogue traders, especially those who do not import any raw materials, by using a methodical approach.
It must interrogate businesses’ cost structures and build up. In doing so, government can then confront profiteering retailers from an informed position.
That will then expose the rogue retailers.
Since the prices started increasing prior to the festive season, the retailers have not been moved by government threats. They increased the prices even more instead.
Address the root cause, not symptoms. DailyNews