Zim cost of living unjustifiably high

Source: Zim cost of living unjustifiably high – DailyNews Live

Eric Chiriga  11 July 2017

HARARE – Nearly a decade after ravaging hyperinflation – characterised by
steep commodity prices rising by the day – it seems Zimbabwe remains a
very expensive country to live in.

Back then, around 2006-8, the country’s cost of living was way too high
compared to its regional peers like Botswana, South Africa (SA) and even
Zambia.

That remains the same today, and the current cost of fuel in the country
in comparison to others in the region indicates that.

According to a latest fuel prices survey by the Zimbabwe Energy Council
(Zec), the southern African nation’s petrol and diesel are way too high in
comparison to other countries in the continent, even compared to the
landlocked ones, whose cost build up in acquiring the commodity –
transport costs and levies – is much higher.

“(In) June 2017, the price of fuel decreased by 25c (South African cents)
in SA, again in July, the fuel price decreased by further 69c (South
African cents).

“In Zimbabwe, it’s the opposite. When every other nation is decreasing its
fuel prices, we are increasing ours! What drives and determines fuel
prices in Zimbabwe, more so when we are using a stable United States (US)
currency?” Zec queried.

Statistics gathered by Zec indicated that Zambia, a land-locked country
like Zimbabwe, is retailing unleaded fuel at $1,11 per litre.

The Council said petrol per litre retails at $0,95 cents in Angola, $0,74
cents in Botswana, $0,79 cents in Lesotho, $1,10 cents in Malawi, $0,95
cents in SA and around $0,91 cents in Swaziland.

In Zimbabwe, a litre of (petrol) blend is averaging $1,32.

The Zec survey also indicated that diesel was retailing for $0,80 cents in
Angola, $0,70 cents in Botswana, $0,81 cents in Lesotho, $1,09 in Malawi
and $1,11 in Zambia.

The same commodity is averaging $1,18 in Zimbabwe.

“The issue of being landlocked does not apply here, Zambia, which is
further and its fuel passes through Zimbabwe every day, is marginally
cheaper than our fuel,” Zec argued.

And if it had not been Finance minister Patrick Chinamasa who shot down
proposals to introduce a fuel levy – targeted at funding a Roads Accidents
Fund on the back of escalating road carnage – the price of the precious
commodity could have been much higher.

While the steep fuel prices may be due to the current economic challenges
faced by the country, including the crippling foreign currency shortages,
the high cost of goods in Zimbabwe is not limited to fuel only.

Even the prices of basic commodities in Zimbabwe are way too high as
compared to regional peers.

The prices of locally produced goods have always been high since adoption
of the US dollar as the key transacting currency, among others, in 2009.

Actually, retailers have increased prices in the US dollar era and even
higher following the introduction of the bond notes, which saw the
emergence of a three tier pricing system – one for bond notes, another for
transfers or swipe and the other and cheaper one for greenback payments.

Retailers have upped their prices to cushion themselves against foreign
exchange losses, with consumers bearing the brunt.

Probably, Zimbabwe desperately needs the controversial National Incomes
and Pricing Commission now than it did way back in the hyperinflation era.

COMMENTS

WORDPRESS: 1
  • comment-avatar
    Anna Kowalska 5 years ago

    The cost of living is high because the laws against business and retailers colluding to keep prices high are not being enforced. They get their forex from the RBZ so claims that they are cushioning themselves from black-market forex losses are spurious. Big business and big retailers as a group jack up prices at the slightest excuse. Just look at the small time operators in the city who are selling goods at a fraction of what many of these big boys are selling at. How come they can do this when they are buying forex at high black-market rates and the big boys get theirs from the RBZ at the official price?