The envisaged moratorium, still to be formally announced and implemented, follows recent steep increases in prices of basic goods, including bread, super-refined maize-meal, cooking oil, flour, and sugar, largely driven by a huge jump in exchange rates, both interbank and black market, in the weeks before the COVID-19 lockdown.
Private sector producers and retailers have agreed with the Government to freeze prices of essential foods as part of measures to cope with the effects of the COVID-19 pandemic and lockdown measures required to contain the threat. Many of the inputs for most of these basics are still imported.
However, exchange rates have now stabilised, the interbank rate is fixed at Z$25 to US$1 for the duration of the COVID-19 emergency and the black market rate stabilising after the Reserve Bank of Zimbabwe (RBZ) stamped on two bureaux de change who had driven the rate up fast in a buying spree on behalf of a small group of buyers just before the lockdown.
The stable rates, coupled with lockdown exemptions for mining and tobacco auctions, the two major export earners, means that a price moratorium is financially viable without creating shortages and rates are likely to remain stable since import pressure has been sharply reduced by travel bans and the difficultly of moving non-essential cargo.
The decision to halt further price increases was contained in a report to Cabinet on the country’s preparedness and response to the COVID-19 outbreak presented by Vice President Kembo Mohadi, who is also the chairman of the ad hoc inter-ministerial task force on the disease.
Bread prices rose by around 33 per cent from an average $20 to $30 during the lockdown, while cooking oil now costs anything between $120 and $160 for two litres, up from $70 depending on brand and the retailer.
Sugar is now selling for over $65 for 2kg while the price of refined maize meal is averaging $230 per 10kg pocket although roller meal remains fixed at $70 per 10kg packet.
Presenting the 12th Cabinet Decision Making Matrix yesterday, Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa said an announcement on the moratorium would be made soon.
“Salient areas where remarkable achievement has been made include discussions regarding the proposed moratorium on prices of identified basic commodities that were concluded and announcements in this regard will be made in due course,” Minister Mutsvangwa said.
Industry and Commerce Minister Dr Sekai Nzenza said her ministry had engaged the private sector organisations, including the Grain Millers Association of Zimbabwe (GMAZ) and the Confederation of Zimbabwe Retailers among others.
According to a survey carried out by the consumer protection affairs section under her ministry, the food basket for a family of six rose from $4 656 in February to $6 660 as of April 11.
“We met with suppliers and producers and this was a multi-sectoral meeting held on April 11 and the people involved are those who produce, manufacture and distribute food and the purpose of that meeting was to find out how we can put our heads together and protect the consumer and the people involved include the GMAZ, the CZR and others.
We came to an agreement, which still needs to be announced and we intend to make the announcement together in due course where everyone will be present,” Dr Nzenza said. The minister added that consultations agreed that the producers would ensure that there would be continuous supply of commodities.
Meanwhile Public Service, Labour and Social Welfare Minister, Professor Paul Mavima said his units had completed compiling the data base for vulnerable people expected to benefit from the $200 monthly cash transfer. Government has set aside $600 million to be disbursed to vulnerable people over three months up to June.
Source – The Herald