BUSINESS is sabotaging efforts to address the overvalued pricing system in the country by operating in bad faith to profiteer, according to Reserve Bank of Zimbabwe (RBZ) governor John Mangudya.
In his monetary policy statement on Wednesday, Mangudya said competitiveness of the national economy was not achievable without addressing the national economy’s cost drivers.
“It is against this background that we applaud Cabinet for setting up the National Competitiveness Commission mandated to critically interrogate the national pricing structure in order to come up with a more competitive model of doing business in the country,” Mangudya said.
He said if prices became competitive, cost drivers for industry would be reduced considerably, especially since there would be no need to increase salaries.
“Addressing the welfare of workers and consumers in general from a cost reduction point of view would also assist businesses in that their products would become competitive against imports.
“It is failure or bad faith by business to quickly review prices downwards that influences workers to demand higher wages and salaries that commensurate with the high cost of living,” he added.
The apex bank boss said after fuel suppliers had reduced prices by around 10%, consumers expected the same to happen to almost all prices, but to date nothing had happened except in a few cases.
Delta Beverages reduced beer and soft drink prices, but a snap survey by Southern Eye Business in Bulawayo revealed that both commodities had only been adjusted in supermarkets and wholesale points, but vendors, nightclubs and bars had maintained pre-reduction prices.
Industry has been calling for government protection against cheaper imports, which it blames for low local demand for indigenous products.
Mangudya said the shift in demand from local goods to imports was a price phenomenon and not the appreciation of the US dollar, which was outside the country’s control.
He said business was shooting itself in the foot by failing to make corresponding adjustments to their prices after input and wholesale costs were reduced.
“This means that businesses would not face closure due to lack of demand, which would have shifted to imports and workers would not lose jobs.”