The majority of Zimbabweans are likely to suffer financially as the prices for basic household necessities continue to climb and shortages of essential services such as electricity, water and medication continue to occur on the regular throughout the country.
The Consumer Council of Zimbabwe (CCZ) said the cost of living for a household of six persons shot up by 13.4% to ZWL40 680 in this month June from ZWL35 877 in April due to the ongoing journey of price hikes, weak and unstable local currency and also due to policies made businesses peg prices at official rates.
The majority Zimbabwean enterprises operating obtain their forex from the parallel market where rates spiked due to the introduction of Statutory Instrument (SI) 127 of 2021 earlier in June.
“The cost of living as measured by the Consumer Council of Zimbabwe’s low income urban earner monthly basket for a family of 6 increased from the end of April figure of ZWL35 877.92 to ZWL40 682.84 by June 9 2021, showing an increase of ZWL4 804.92 or 13.39%.
“The food basket increased by ZWL1 504.23 or 9.83% from ZWL15 303.88 by end of April 2021 to ZWL16 808.11 by June 9 2021,”said by the CCZ.
Under the SI policy businesses were required to align their pricing with the official exchange rate but instead, prices have shot up by 40% since then, as well as in the United States Dollar terms.
“According to the recent survey, most suppliers and outlets did not reduce their prices in Zimbabwe dollars to align their pricing with the requirements of SI 127, instead they priced products higher in USD terms to make sure they get around about the same they were getting in local currency before SI 127 of 2021,”as stated by the CCZ.
At the centre of the price hikes was a switch by supermarkets to tracking parallel market rates in their pricing models despite accessing foreign currency at the forex auction market and several enterprises including the Zimbabwe Stock Exchange listed National Foods were listed in a category of forex abusers by the Reserve Bank of Zimbabwe, which promised to charge huge fines announced under SI 127.
Authorities began a ruthless crackdown on low-income earners’ vending cities in Harare and Chitungwiza, of which these actions will add on to the mountain heap of despair on Zimbabweans who mostly survive on the informal sector, following de-industrialisation due to economic incompetence.
Government authorities also carried out measures in late June to better the country that seemed a bit too aggressive as officials destroyed retail stands, deemed illegal, in Mbare flee market leaving retailers devastated and residents disgusted by the aftermath filth.
Black market rates for the USD has jetted to ZWL140: 1USD against about ZWL85: 1USD at the foreign currency auction market.