/ 22 June 2006

Zim bakers arrested for defying price ceiling

Zimbabwean police have arrested more than 280 bakers and shopkeepers for defying a state-imposed ceiling on bread prices meant to combat inflation, a newspaper said on Thursday.

“At least 282 bakers and shopkeepers have been arrested in Harare for charging more than Z$85 000 (US83c) for a standard loaf of bread,” the state-controlled Herald reported.

Bakers increased the price of bread to between Z$130 000 and Z$160 000 dollars a loaf, citing the escalating costs of inputs, including imported flour.

The newspaper quoted police spokesperson Memory Pamire as saying many of those arrested had paid fines but that repeat offenders would be prosecuted.

Bread is in short supply in Harare with shops stocking buns and scones, whose prices are not controlled by the government. Bread is a breakfast and lunch staple among low-income workers.

Zimbabwe introduced price controls four years ago to fight a burgeoning black market in staples such as cornmeal, cooking oil and bread, levying a fine of Z$1-million for violators.

But bakers say the state-imposed price, which has not been revised since last year, was “unsustainable” and that they decided to increase the price to avert a total collapse of the industry and save at least 20 000 jobs.

“It is our desire to keep bread affordable and all along bakers have been operating on squeezed margins in order to strike a balance between viability and affordability,” the National Bakers’ Association said in a statement.

“Bakers have been seriously affected by the current hyperinflation environment, which has seen annual inflation as at the end of May rising to 1 200 percent%

Zimbabwe’s economy has been on a serious downturn over the past six years, characterised by high inflation, unemployment and chronic shortages of basic goods such as sugar, fuel and cornmeal. — AFP