1300 business executives nabbed in price blitz

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By Nelson Banya

A ZIMBABWE court on Monday fined dozens of business executives for defying a price cut ordered by President Robert Mugabe's government in an effort to gain control over the world's highest inflation rate.

The southern African country is in the grip of a severe economic crisis that has sent official inflation figures spiralling above 4,500 percent and private economists estimate the real rate may be far higher.

More than 1,300 shop owners, managers and company executives have been arrested for failing to cut prices since the freeze was announced on June 25, but most have only been fined.

On Monday, 33 business executives, some of whom spent the weekend in police custody, appeared in court for offences ranging from defying the price freeze to failing to display prices for basic goods.

Most of them pleaded guilty to violating price control regulations and were ordered to pay 3 million Zimbabwe dollar fines ($23 at the black market rate and $200 on the official market), and were then set free.

But at least two had their cases postponed to allow further investigations and were sent back into custody.

A crack team of police, military and intelligence operatives is enforcing the price freeze, which has been welcomed by ordinary Zimbabweans used to frequent increases in public transport fares, rentals and hospital services and fuel prices.

But some warn the relief may be temporary. Basic goods like cooking oil, maize meal and sugar have already disappeared from shop shelves after prices were slashed, with economic analysts predicting that these would resurface on the thriving black market at even higher prices.

Police spokesman Oliver Mandipaka told the official Herald newspaper on Monday many business people had paid fines as high as Z$100 million.

Mandipaka warned of a wider crackdown on business people and black market vendors who are enjoying roaring trade as goods become scarce in formal shops. The government has already banned bulk buying to ease shortages.

Mugabe, facing growing pressure at home from the deep economic crisis that has left four in five adult Zimbabweans jobless and caused shortages of foreign currency, food and fuel, accuses firms of raising prices as part of a plot to unseat him.

Mugabe -- whose government ordered a in slash prices after some basic goods had risen by up to 300 percent in one week -- said there was no coincidence in the price hikes.

The 83-year-old leader -- in power since independence from Britain in 1980 and seeking another five-year term in 2008 -- has threatened to seize and nationalise foreign companies he says are sabotaging the economy.

The defiant Mugabe says Britain has led a Western campaign, that includes the imposition of sanctions on Harare, to punish his government for handing over hundreds of fertile white-owned commercial farms to landless blacks. -- Reuters

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