HARARE – Zimbabwe is facing massive food shortages reminiscent of the 2008 hyper-inflationary era, as the country battles a worsening cash crisis that analysts blame on President Robert Mugabe and Zanu PF’s poor economic policies.
A survey conducted by the Daily News yesterday also showed that the prices of many basic foodstuffs have recently risen by at least 20 percent, while supermarkets have begun imposing a limit on the quantity of basic goods that individuals can buy.
For example, a two-litre bottle of cooking oil, which was going for an average of $2,99 on Friday last week, is now retailing for up to $3,60 — while foreign cooking oil brands have vanished from the country’s supermarket shelves altogether.
United Refineries chief executive Busisa Moyo told the Daily News yesterday that cooking oil shortages that are being experienced in the country were due to delays in payments to raw material suppliers.
“We are very concerned about the issue because payments are not being prioritised and payments are not going through fast enough despite the fact that we are in the top 10 of the central bank’s Import Priority list,” he said.
Moyo also noted that cooking oil producers were anticipating a 30 percent slump from the current 8 000 to 10 000 metric tonnes being produced, due to cash shortages.
Oil Expressers Association of Zimbabwe (OEAZ) president Sylvester Mangani echoed Moyo’s sentiments at a ministry of Industry meeting last Friday, saying the situation — if it continued unabated — would lead to a serious shortage of the commodity.
This comes as producers are failing to secure key raw materials from foreign suppliers, as the country’s banks have low nostro account balances.
A nostro account is a bank account held in a foreign country by a domestic bank, mainly to facilitate settlement of exchange and trade transactions.
In this light, when pressers make orders, their respective banks have to pay the suppliers through the nostro account.
Disgruntled citizens interviewed by the Daily News yesterday said they were now resorting to hoarding most basic commodities in preparation for the looming food shortages.
“We have heard rumours that there is going to be major price increases on most basic commodities, as well as shortages because of low or no imports.
“As such, we are buying things like maize-meal, flour, cooking oil, rice and sugar among others, ahead of the expected price increases,” said a shopper who only identified himself as Mapfumo.
The latest development comes after the prices of other basic goods such as maize-meal and salt have also been increasing steadily.
Zimbabwe, which is battling an economic recession after failing to register significant growth since 2013 when Mugabe and Zanu PF romped to a hotly-disputed election victory, is in turmoil after the central bank introduced a raft of measures to deal with the cash shortages last month, including limiting daily cash withdrawals.
The May 4, 2016 measures that included a proposal to introduce bond notes have seen depositors embarking on panicky withdrawals, fearing a return of the discredited Zimbabwean dollar.
Economic experts say the recent appreciation of the greenback against regional currencies, as well as Zimbabwe’s widening trade deficit — $3 billion by end of December last year — have also contributed to the severe cash crisis.
Labour and Economic Development Research Institute of Zimbabwe economist Prosper Chitambara said yesterday the cash shortages were also affecting businesses that needed to transfer money to other countries to pay for goods and services.
“The major problem is mainly a lack of confidence that has affected deposits in the banking sector. We are also witnessing a mini banking crisis . . . manifesting itself through what we call a bank run,” he said.