We hope govt isn’t mulling price controls

Source: We hope govt isn’t mulling price controls – NewsDay Zimbabwe April 22, 2019


LAST week, for the first time ever since he took over the reins of this troubled economy, President Emmerson Mnangagwa and his Treasury minister Mthuli Ncube went ballistic over the galloping prices of goods and services. Both gentlemen described the price hikes as “inhuman, unethical, unpatriotic, unjustified and unnecessary”.

While we applaud the two men for finally having had the guts to squarely face bread and butter issues that have been gnawing at every average citizen, we, however, wish to remind government and our leaders not to discharge their vitriol on the business, which is barely managing to keep its head above water.

We wish to kindly take our leaders back to the morning of January 13 this year, when the country woke up to a 150% hike in fuel prices which government justified by saying it would reduce demand of the scarce commodity. The hike was such a shock that it triggered nationwide mayhem which was ruthlessly clamped down on by State security forces.

However, if truth be told, that 150% hike in fuel was the spark to the prevailing uncontrollable price stampede. There is a vernacular adage that aptly sums up what we are saying: Kamoto kamberevere kanopisa matanda mberi. Loosely translated it means small issues can, over time, become large enough to cause major problems.

In raising the fuel prices, what government forgot was that fuel is a fundamental component in the pricing regime, especially for a landlocked country like
Zimbabwe, whose fuel was already unsustainably too high long before the January price hike. So our leaders, instead of now trying to shift the blame on the
hapless business, they should simply swallow their pride and go back to basics and start implementing economic policies that make sense.

The country, which remains largely agro-based, is currently facing prospects of a very bleak harvest season following a poor rainfall season. The country has been unproductive for nearly two decades and increasing the price of fuel under such circumstances was the single biggest blunder the new government had made so far. The increase did not even reduce demand, but upped it as business and individuals tried to make ends meet.

We are afraid, if by some chance, government tries to institute price controls of some sort, this will merely cause worse problems of food shortages for the troubled economy and Mnangagwa’s administration. Price controls would definitely be the last nail in the coffin.