(HERALD) Govt rolls out basic goods

Govt rolls out basic goods
Business Editor Victoria Ruzvidzo

TRUCKLOADS of goods were dispatched from Harare yesterday as Government rolled out the Basic Commodities Restocking Programme under which vulnerable groups will access products at affordable prices. President Mugabe launched the programme in Nkayi last week under the People’s Shops concept, stressing that prices charged will be within the reach of the majority. Countrywide deliveries will be done on a daily basis. Trucks were yesterday queuing at warehouses in Harare as they waited for their turn to load.

Products being supplied to restock shops include maize-meal, sugar, salt, flour, cooking oil, laundry and bath soap, candles, sugar beans, rice and sanitary pads.

Prices will be slashed by as much as 90 percent in some instances to ensure affordability by those in the low-income bracket.

For instance, a 750ml bottle of cooking oil, whose price currently ranges between $9 billion and $15 billion, will be sold at less than $1 billion.

This intervention comes at a time when prices of goods and services have continued to rise to unprecedented levels, with some manufacturers "unjustifiably" attributing this to rising input costs.

However, under the programme, Government is supporting producers of basic commodities under strict covenants that such products will be supplied into the restocking programme at prices that reflect true production costs.

The initiative is part of the Basic Commodities Supply Side Intervention facility launched by the Reserve Bank of Zimbabwe in October last year, running until the end of this year.

RBZ Governor Dr Gideon Gono yesterday commended Government for launching the programme, which could effectively subdue some of the inflationary pressures in the economy.

"We hail this innovative intervention by Government as it brings tangible supply to the doorsteps of the majority of the people. As Governor, I want to once again reiterate that the Bacossi support we are extending to our strategic productive sectors is essentially meant to fight off inflation from two angles.

"Firstly, the direct impact on supply, as can be seen from this Government programme, is unambiguously leading to massive price reductions.

"Secondly, when we extend Bacossi support per unit production cost in the economy, decreases on overheads are distributed on more output arising from higher capacity utilisation levels.

"As a central bank, we fully support this intervention by Government," said Dr Gono.

For most low-income earners, basic products were now priced beyond their reach, a situation that was exacerbated by massive price jumps in recent weeks.

The emergence of the black market for goods had seen most shops being wiped clean as products were diverted to the more "lucrative" parallel market.

The release by Government of $150 trillion last month for the setting up of People’s Shops through the Small Enterprises Development Corpo-ration, is also expected to go a long way in ensuring greater access to products at affordable prices by vulnerable groups.