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(HERALD) Biti raps retailers over high profit margins

Biti raps retailers over high profit margins
Herald Reporter

FINANCE Minister Tendai Biti has rapped retailers over high profit margins saying this creates inflationary pressures, warning that this may force Government to institute preventive measures. Minister Biti said it was astonishing that local retailers were putting profit margins of between 20 and 30 percent on products.
"The retail sector is refusing to rid itself of the old habit of the hyperinflationary era.

"I would like to warn you that you are inviting yourselves the old sticks (price controls, setting and monitoring) that used to beat you up," he said.

The Finance Minister made the remarks at the Confederation of Zimbabwe Industries post-Budget breakfast meeting yesterday.

Minister Biti said profit margins of between 9 and 15 percent were realistic.

"You must know that the money is real, operations are real and the currency is real. You cannot have margins of 30 percent."

He castigated retailers who have increased prices ahead of the festive season to cash in on annual bonuses and 13th cheques.

Annual inflation stood 3,6 percent for November down from 4,2 percent in October.

Annual inflation is projected to close the year at 4,8 percent, which is within the acceptable regional average of 4,7 percent. Inflation is the rate of increase in the price of goods and services over a given period.

Minister Biti said the spate of price increases was not based on any justifiable change in economic fundamentals.

Labels: INFLATION, TENDAI BITI

posted by MrK @ 3:22 AM