Oliver Kazunga, Senior Business Journalist
RESERVE Bank of Zimbabwe (RBZ) Governor Dr John Mangudya said yesterday his meeting with the companies this morning was not a witch hunt, but an effort by authorities to grasp the root cause of the madness prevailing price.
The all-stakeholder forum attended by representatives of retailers, producers, wholesalers and all those involved in the value chain, he said, will explore sustainable solutions to widespread parallel market pricing that erodes economic stability.
In recent weeks, the formal market has been gripped by benchmarking the prices of goods and services using the black market rate, which has resulted in a surge in prices.
Last week, the parallel market exchange rate was set at $ 1: ZWL $ 180 against margins of between ZWL $ 150 and ZWL $ 160 three weeks ago.
As a result, some formal market retailers and businesses were pricing above the official rate of US $ 1: ZWL $ 88.55 last week.
An instant survey by Chronicle in Bulawayo last Friday showed that some formal market retailers were selling their products at an exchange rate of around ZWL $ 200 to US $ 1.
Speaking by phone yesterday, Dr Mangudya said:
âWe will be meeting with the entire business community, producers, retailers and wholesalers to find a sustainable solution.
âIt has been brought to our attention that everyone in this country has become a price taker, so we want to know who is causing it. It’s not about stopping people; it is about understanding the real cause of what is happening.
“The most sustainable way to run a business or run a country is not to quit, but it is to understand behavior and behavioral dynamics is not fundamental,” he said, adding that the behavioral dynamics were due to arbitrage tendencies.
Dr Mangudya said that for any business to operate in a viable manner, there needs to be a stable environment, adding that obtaining the volatility caused by parallel market activities threatens the macroeconomic gains the country has achieved so far. here.
Zimbabwe Retail Confederation (CZR) President Denford Mutashu said he noted with concern the price dilemma that prevails for most retailers and wholesalers.
He said that it was brought to their attention that there were four exchange rates one had to face in order to pay for goods and services.
âCZR has noted with concern the price dilemma that prevails for most retailers and wholesalers and warns of difficult times ahead. We implore the government to set up an inter-ministerial committee to question the challenges, abuse, manipulation and arbitrage of exchange rates and chart the course for stability as the parallel market exchange rate poses a great downside risk. projections and business results, âMr. Mutashu said.
There is the auction exchange rate (ZW $ 89 to US $ 1) ZW swipe to US $ (ZW $ 180 to US $ 1), ZW mobile money to US $ (ZW $ 200 US $ 1 US and ZW cash to US $ (ZW $ 165 to US $) 1).
“We have also discovered that there is also a tariff for nostro US $.”
Black market rates, he said, change more than three times a week.
“We are meeting with the Reserve Bank of Zimbabwe tomorrow morning and this meeting which is a forum of all stakeholders includes retailers, producers, wholesalers and everyone involved in the value chain,” said Mr. Mutashu.
He said the procurement situation has created confusion in the market with extreme cases being when the supplier or manufacturer or wholesale store categorically refuses all other payment for goods and services except US dollar cash that comes with discounts to attract the retailer or wholesaler. – @ okazunga