Price hikes dampen consumer spending
THE continued increase in prices despite the prevailing exchange rate stability has been blamed for weakening consumer spending amid revelations the cost of living for an average family of six has risen to $39,141, according to the Consumer Council of Zimbabwe (CCZ).
The basic incomes for a majority of workers trail behind the cost of living with unions in both private and public sectors continuing to engage employers towards an upward review of salaries.
The retail sector, which has also raised concern over subdued volumes due to low disposable incomes, has seen most of its members increasing prices recently defying a Government directive to peg their prices in line with the official weekly Foreign Currency Auction Trading system.
Confederation of Zimbabwe Retailers (CZR) president Mr Denford Mutashu has defended retailers that are using the parallel market rates saying the RBZ auction system does not adequately cover most sectors.
Since its launch last year, the official forex auction platform has been lauded by industry leaders for improving the productive sectors’ access to foreign currency. However, several formal and informal traders have defied the Government regulations and have continued to increase prices above the official rate, piling misery on consumers.
According to the latest CCZ report, the food basket for a family of six stood at $15 425,57 in May. The food basket comprise mainly of basic commodities that include 2×20 kgs of roller meal each pegged at $1 255,50, three packets of 2kg brown sugar at $243,79, four bottles of 750ml of cooking oil selling at $171,24 each as well as 2x2kg of rice each sold at $250,61.
Other basics that constituted the CCZ food basket in May included 8kg of meat (economy) at $428,68 a kg, and a 2kg packet of tomatoes at $126,17 a kg.
On soaps and detergents, the consumer watchdog indicated that a family of six required four tablets at $52,07 each while four bars of laundry soap were pegged at $111,63 each and three 500 grammes of washing powder at $130,37 each.
For expenses such as transport, rent, water, electricity, clothing and footwear, health, and education, a family of six required $22 670,50.
Contacted for comment, National Consumer Rights Association spokesperson, Mr Effie Ncube, said consumers were struggling to access basics due to steep pricing.
“This demonstrates how dire the situation has become for consumers in Zimbabwe. Families are unable to feed themselves because very few people will be able to earn $40 000 or $50 000 needed to sustain a family of six,” he said.
“Most of the people are not limited just to six people, they have larger families and have extended members of family.”
Mr Ncube urged the Government and other stakeholders to come together and find ways to cushion workers while containing the rising cost of living.
“It is important that we build an inclusive economy that creates jobs and incomes for all people in rural and urban. That really calls for urgent attention,” he said. —chronicle.c.zw
