Govt to put measures in place to reduce cost drivers

Published: 23 April 2018

GOVERNMENT is putting in place measures to reduce cost drivers in order to enhance competitiveness of the country's exports.

Industry, Commerce and Enterprise Development Minister Dr Mike Bimha said this last Thursday while addressing delegates to the 4th edition of the Confederation of Zimbabwe Retailers (CZR) conference.

"Government is fully aware of how the high cost of power, water and labour have hampered business competitiveness in the past. To this effect, a National Competitiveness Commission was formed and is in the process of being operationalised and strengthened to look into these cost drivers among other issues affecting business in Zimbabwe," said Dr Bimha.

He said the retail and wholesale sectors play a crucial role in the economy.

Minister Bimha however, said the problem of pricing has in some cases frustrated demand and compromised viability of many enterprises.

The pricing concern has been blamed on high cost structure in the economy, which forces firms to pass on the burden to consumers.

Minister Bimha said his ministry was focused on stabilising prices in order to protect consumers.

He said an ad hoc committee on price stabilisation has been put in place to monitor pricing patterns while Government worked on reducing fuel prices which were among major cost drivers.

The delegates expressed concern at the acute shortage of foreign currency which they said was impacting negatively on their operations.

Participants noted that the multi-tier pricing system was continuing as RTGS balances continue to balloon.

The development has seen selected players take advantage of the challenges to speculate and thereby distort the market for selfish gains.

CZR president, Mr Denford Mutashu, said the retail sector deserved to be supported as it contributes about 50 percent to the GDP.

"Consumer purchasing patterns determine the level of economic activity and at the moment the economy is highly consumptive and the spending patterns have been influenced by the flexibility of payment methods which has seen many consumers embracing the use of plastic," he said.

Mr Mutashu however, bemoaned rampant smuggling of goods which he said resulted in unfair competition. He said banned goods and those under import restrictions were readily available in the informal retail sector.

Mr Mutashu also complained about the sprouting of vendors operating on pavements, saying these activities were threatening operations of formal businesses.

He urged authorities to intervene and remove these vendors from the pavements.

The conference's theme was: "Achieving Price Stabilisation Through Value Chain for Sustainable Economic Development".
- zimpapers

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