Retailers yesterday pledged to continue reviewing down prices of basic commodities as long as cost drivers are reduced and applauded Government for coming up with a value chain price stabilisation mechanism. Government last week reduced excise duty on petrol and diesel by 6,5 cents and 7 cents, respectively. The intervention by Government was expected to stabilise prices of basic commodities and is already bearing fruit.
High production cost structures were being partly attributed to high fuel prices. The reduction in fuel prices also contributed significantly to the cost of doing business. Confederation of Zimbabwe Retailers president Mr Denford Mutashu said: “We are part of an engagement process which is being coordinated by Government on price stabilisation. We have pledged and we will continue to reduce prices as long as cost drivers are reduced. There is no reason for us to keep prices when we are getting them at lower prices.”
Mr Mutashu applauded the Government for taking measures to stabilise prices and the economy at large. “If you check, for instance, the price of beef has gone down to about $3,90 a kg. We applaud the Government for coming up with a value chain price stabilisation approach and we will continue to work with Government to ensure prices further go down. What we get from manufacturers is what we also pass to the consumer.
“What we are also saying is that there is now too much money on the market chasing few goods, so we need to increase local production. At the moment, the money in Real Time Gross Settlements (RTGs) form is not matching the level of production in the country.” Confederation of Zimbabwe Industries (CZI) president Mr Sifelani Jabangwe last week said the overall consumer price index was inclined to fall further.
“The private sector business community acknowledges and welcomes the recent Government interventions to reduce excise duty on petrol and diesel. Out of the 15 monitored basic commodities, prices of economy beef for example are expected to fall by an average 10 percent to 20 percent.” Already, the price of beef has fallen from around $9.80 a kg to $4, 99 per kg in some supermarkets in Harare.
An economist, Mr Kingstone Kanyile, concurred with Mr Jabangwe last night saying the reduction in excise duty on fuel by Government was a good move. “The marginal tax reduction serve as an indicator that this administration is serious about improving the cost and ease of doing business. Although insignificant they are welcome. Perhaps we will see further tariff being lowered. So far we are happy. So far the indicators are positive.”