DEPUTY CHIEF WRITER
©️ THERE appears to be no end in sight to the economic pain of ordinary Zimbabweans, with the prices of basic consumer goods shooting up further yesterday — following a shocking fuel price hike of 150 percent on Tuesday night.
“The implications are huge. Any price increase on fuel has inflationary consequences. This will affect the cost of food, mealie-meal, transport and everything else.“It has serious implications at a time when many people are unemployed and the economy is in bad shape,” he said.
Ncube also said the country needed to introduce a stable currency such as the US dollar or the South African rand in the short term, as the local currency was now “worthless”.“We also need to address the political situation in the country. The country’s problems are a result of the political challenges we are in.“So, once we address the political situation through reforms, we can then be able to address corruption and the other economic challenges,” he said.
The president of the Confederation of Zimbabwe Retailers, Denford Mutashu, said prices naturally responded to movements on key cost drivers such as fuel.
“If the market-related exchange rate now being established brings about stable prices for fuel and other imports, inflation will start going down after a few months, but wages will have to rise to restore purchasing power.
“If the currency auction average settles at around 60 to one, costs will be lower for imports and prices should come down. We have to hope that the auction rate stabilises very soon,” he said.
“The government has said that the introduction of the new exchange rate system will stabilise the exchange rate and also put to an end speculative tendencies.
“However, this has not inspired confidence in the economy and it is going to be difficult to achieve these goals,” Hawkins told the Daily News.
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