‘Use auction rate for pricing-CZR’

RETAILERS accessing foreign currency from the auction market should peg the prices of their goods and services using the ruling exchange, the Confederation of Retailers (CZR) has said, warning defiant members may face the full wrath of the law.

This also comes amid revelations that some importers may be diverting part of the foreign currency accessed on the Reserve Bank of Zimbabwe (RBZ) auction system to unintended purposes, which could jeopardise sustainability of the platform.

It is against this background that the retailers lobby group has called for an audit committee that monitors and evaluates the application of funds procured from the auction to deter abuse of the system.

CZR president Denford Mutashu, said this after a meeting with the Deputy Minister Finance and Economic Development Clemence Chiduwa, where it was agreed that retailers be persuaded to comply with the law regarding pricing in line with the exchange rate.

But Mutashu said retailers failing to comply with the legal requirement while getting cheaper forex on the auction risked heavy civil penalties, as provided for in terms of the relevant law, Statutory Instrument 185 of 2020.

“It was by mutual consent yesterday that the private sector should lead the rallying call for all retailers to comply. It was agreed that while they might be challenges, this must not stop retailers from complying with the policy and legal requirement on the exchange rate related pricing,” Mutashu said in an interview.

Zimbabwe has enjoyed relative price stability since the central bank introduced the auction system for foreign currency in June this year, which has also translated into declining inflation levels

The country’s foreign currency exchange rate appears to have reached high levels of stability in the market-driven auctions with the local currency continuing recent trends of a minute firming, one eighth of one percent yesterday to $81,34 against the US dollar.

Earlier in a statement, Mutashu said CZR wished to remind the retail sector of the existence of a legal requirement that compels them to comply with the ruling exchange rate policy on pricing.

“It is CZR’s humble position that businesses should support the auction through responsible pricing and compliance. The customer receipt should bear the currency in which the transaction has taken place,” Mutashu said.

The CZR president said there had been made aware of defiant retailers who continue to use parallel market rates when pricing their goods and services, despite accessing foreign currency from the auction.

However, Mutashu said it was critical for the Government to address issues of systems and software compatibility as well as availability of fiscalised machines, pointing out though that challenges in this regard, should not stand in the way of compliance.-chronicle.cl.zw