RBZ, business to meet over price upheaval

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By Alois Vinga

RESEVE Bank of Zimbabwe (RBZ) governor John Mangudya says he will soon be meeting with business representative organisations to try and reach a lasting solution to the current pricing deadlock between authorities and industry.

The central bank chief said this in an interview with Business on Monday.

“We have been working flat out to restore normalcy in our markets over the weekend and I think you can now see that most basic commodities are now available.

“Fuel queues are getting shorter and shorter and we now need to move to the next stage where we will engage with organisations like CZI to contain the prices,” he said.

This comes after some major supermarkets in the country have closed shop with signs they were unable to cope with the rate with which prices were going up while at the same time fearing a government backlash if they increased prices to try and match the situation.

Vice President Kembo Mohadi last week issued threats to dispatch price control monitors and also to withdraw licenses from business owners found defying government’s directive to maintain prices which prevailed before Finance Minister Mthuli Ncube’s recent introduction of a 2 percent tax on electronic transfers and the separation of US dollar from local currency bank accounts.

The Confederation of Zimbabwe Industries has accepted government’s policy measures but urged authorities to put a year’s time frame to the new levy arguing it weighed down on struggling entities.

However, there seem to be an undeclared deadlock between government and business as the former, although revising the 2 percent levy to transactions of above $10 and also putting a cap on the tax, has maintained its position.

Business, on the other hand, seem to have stopped producing or selling, with the general public bearing the brunt.

The situation has not been helped either by black market forex rates which keep rising with one now required to pump out almost 200 Zimdollars to get US$100 from the street where it is obtainable.

To break the deadlock, Mangudya has said that government will soon be meeting business.

Meanwhile, Mangudya has disowned reports that he ever told local media there was a small group of powerful individuals who controlled the black market.