Private sector to reduce prices

Source: Private sector to reduce prices | The Sunday Mail January 28, 2018

The private sector has affirmed its commitment to pass on to consumers the resultant cost savings in production and distribution of basic commodities following the reduction of fuel prices by Government.

Government on Monday last week intervened by reducing excise duty on petrol and diesel by 6,5 cents and 7 cents respectively.

This was followed by slushing of fuel pump prices by an average 3 percent, bringing huge reprieve to business in particular and the public in general.

Industry said it shall incorporate this fuel price reduction into its pricing structures, which will result in the prices of basic commodities falling by ranges of 1 percent to 5 percent.

Confederation of Zimbabwe Industries president Sifelani Jabangwe, last week said the overall consumer price index is therefore inclined to fall further from 1,2 percent increment experienced over the 2016-2017 period.

“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,” said Mr Jabangwe.

In addition, the private sector business community agreed to adopt global best practice by publishing the recommended wholesale and retail prices on either the product packages or in the media.

In particular, the cooking oil industry shall be working with its distribution partners to ensure that the wholesale and retail mark ups are guided by the manufacturer’s recommended prices.

Mr Jabangwe said the industry further acknowledges the commitment made by Government to improve the national macro-economic conditions and ensuring an improvement in the supply of scarce foreign currency resources required to stimulate domestic production and stabilise prices of basic commodities.

He said the industry commits itself to continue engaging with Government through the National Competitiveness Commission in order to address the major cost drivers affecting the economy.

“We welcomed renewed efforts towards improving business confidence and competitiveness in the domestic agricultural and manufacturing    sectors by reducing the current regulatory cost of compliance by at least 50 percent.

“It is paramount as a nation that we continue to work towards improving domestic production and productivity for the benefit of all stakeholders.

“We in the private sector business community re-affirm our commitment to playing our part,” said Mr Jabangwe.

Industry has been complaining of high cost of doing business in the country, chiefly triggered by high costs of fuel and premiums charged on foreign currency at the black market.

Most companies are operating at about 50 percent capacity, while re-tooling is imperative as the majority of them are using antiquated equipment that frequently breaks down, making the commodities they make uncompetitive locally and abroad.

Many companies are upbeat the fuel cuts and other Government interventions will be help free operating space for the industries.