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Chaos in Zim as prices cut
03/07/2007 20:41 - (SA)
Harare - Shoppers went on a stampede in a leading Harare supermarket Tuesday, heaping trolleys with groceries after the government slashed prices by half in a bid to curb profiteering.
In another store down the street, gaping spaces testify to shoppers stripping shelves of soap, sugar, bread, milk and other commodities.
Zimbabwe has been gripped by panic buying as consumers cash in on a price freeze and stock up in anticipation of shortages likely to follow.
"The reason I am buying these things ... is that I do not know what will happen tomorrow," said Tafadzwa Musemburi, an automobile electrician in Harare.
"I was forced to borrow Z$4m ($16 000 at the official exchange rate, but $36 on the parallel market) just to get these few things," he said pointing to a trolley containing sugar beans, peanut butter and other items.
Commodities are fast vanishing after the government forced shops to cut prices and ordered a freeze on increases.
President Robert Mugabe has accused businesses of profiteering and working in cahoots with the country's enemies to incite people to revolt against his government.
Crack units of security force members and a pricing commission have been set up to raid shops and arrest those who violate the directive.
'Nonsense must come to an end'
On Monday, police raided spots where black market dealers are known to operate and seized various groceries.
"We have started to deal with the parallel market dealers as they are hoarding foodstuffs," police spokesperson Oliver Mandipaka told AFP, adding that 190 people were arrested for breaching the price ceiling.
Mugabe warned last week his government would seize and nationalise businesses found to be profiteering, as well as mines taking minerals out of Zimbabwe.
"This nonsense of price escalations must come to an end," the octogenarian president told mourners at the burial of national hero Paul Armstrong Gunda.
"Those who are in construction and supplies, take note. We are following you. It's not going to be an easy game. It's going to be a rough one. We will never allow ourselves to be defeated by these British tactics.
"The companies must straighten their ways because those in gold mining are externalising gold. We will nationalise them if they continue with their dirty tricks."
Following Mugabe's statement, Industry and International Trade Minister Obert Mpofu ordered a blanket freeze on the prices of all goods and services.
Many shops in the capital have followed the government order and reduced the price of commodities such as bread from Z$44 000 to $22 000.
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Analysts warn the price freeze would only worsen the lot of industries already struggling against foreign currency shortages and frequent power cuts.
Uncertain future
Zimbabwe National Chamber of Commerce president, Marah Hativagone, told AFP: "My heart is bleeding right now because this does not work and consumers are the ones who will suffer.
"I just hope the government will see sense and revert to normal business practices."
Hativagone said many companies would be unable to pay their workers after being forced to reduce their product prices.
"Our laws do not allow us to cut wages or salaries."
Retail shop assistant Tapiwa Madzikana is not certain what the future holds.
"What will happen to us after all the goods disappear from the shops, nobody knows and noboby seems to care," he told AFP on Sunday.
"Right now it is better to buy what you can and stock or re-sell it because very soon the shelves will be empty. As you can see for yourself some sections of the shop are already empty."
The Zimbabwean government introduced price controls five years ago to fight a burgeoning black market in staples like cornmeal, cooking oil and bread, but has failed to stem spiralling inflation.
- AFP
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