In a bid to ease widespread shortages of goods, Zimbabwean President Robert Mugabe’s government on Friday announced it was allowing retailers to raise prices by 20%.
”Effectively, the prices of all goods and services that have not been reviewed since June 18 2007 go up by 20%,” the government mouthpiece Herald newspaper said.
”The announcement is in line with the government’s policy to ensure viability in the business sector,” it added.
The paper said the price adjustment was authorised on Thursday by Elliot Manyika, the acting chairperson of a special price-monitoring taskforce.
In June, stores, garages, pharmacies, butcheries and even electronics shops were ordered to slash their prices by at least 50% in what was supposed to be a move to protect consumers from runaway price hikes.
But the price blitz backfired, causing massive shortages of household basics like cooking oil, bread, meat and milk.
Many of the goods have reappeared on the black market at inflated prices.
The prices of a few goods, including bread, meat, beer and maize meal have been raised in recent weeks, but this has not improved availability as their prices are still way below those on the black market.
Inflation in Zimbabwe is now more than 7 600%, the highest rate in the world.
Two major bakeries are on the brink of closure because there is no flour, and because the price of bread set by the government is well below production costs.
Police chief Augustine Chihuri warned small business operators against fuelling the black market with commodities that should be sold at official prices.
”We are very much aware that even the small and medium enterprises are also contributing to fuelling the parallel market, which [the] government is trying to curb,” he was quoted as saying.
”We want to warn all elements who are driven by greed and would want to take advantage of the situation and exploit people.”
The paper said more than 3 500 street vendors had been arrested since the start of the price blitz on June 26.
More than 7 000 business executives, shop and garage owners have also been arrested for defying price controls.
Many have been fined or ordered to perform community service such as cleaning government schools or police stations. — Sapa-dpa