The Sunday Mail
Pamela Nyabadza
Several locally manufactured basic commodities are now marginally cheaper than imported products whose prices have soared since January as a result of rising competition and stringent excise duty enforcement, especially at Beitbridge Border Post.
A survey by The Sunday Mail in selected supermarkets in central Harare showed that the prices of products such as sugar, cooking oil, maize meal, flour, soap, washing powder and salt have declined over the last six months.
A 10kg bag of roller meal now costs an average US$6,50, down from about US$6,80 in January. The same amount of imported maize meal costs US$6,90.
A 2kg packet of sugar is now selling at US$1,75 as opposed to the previous US$2,10, an amount still being charged for imports.
A 2kg packet of South African-produced flour is selling at US$2,50 compared to US$2 for the local product. Zimbabwean-produced flour sold at US$2,20 in January.
The price of a local bar of soap went down US$0,20 to US$1,60 whereas US$1,80 is being charged for foreign brands. A 2-litre bottle of cooking oil is now pegged at US$3,65, down from US$3,89, while South African brands cost US$3,90.
In addition, a 1kg packet of salt, which previously cost US$0,70, is now priced at US$0,50 while 2kg of rice now cost US$1,75, down from US$2,10. The price of spices is now pegged at US$0, 40 compared to US$0,50 in January and the price of a 500g sachet of washing powder has gone down from US$1,30 to US$0,90.
Confederation of Zimbabwe Industries president Mr Charles Msipa confirmed that indeed business had been forced to reduce prices due to the liquidity crunch. He said he was unaware of product shortages as reported by some retailers.
“In the environment of weak domestic demand due to the liquidity crunch that most businesses are operating in, many businesses have had to reduce pricing, even in some cases break-even margin levels, in order to maintain capacity utilisation, business continuity and employment.
“Some economists have suggested that given the strength of the US$ currency, prices, wages and salaries will have to be reduced in order to stimulate economic growth.”
Food World supermarket manager (Jason Moyo Branch) Mr Blessing Jones confirmed the price reduction, attributing it to rising market competition.
He was, however, concerned about the inconsistent supply of local products.
Mr Jones said demand for cheaper products was pushing business volumes up.
“The prices of some products have now been reduced because of the competition that imported products have presented. These imports used to be cheaper, so local businesses subsequently slashed their prices.
“We are getting the goods from manufacturers at lower prices and retailers obviously reflect the price shift. However, the major problem is the availability of locally-manufactured goods. That is the reason why people end up turning to other countries.
“Also, the manufacturers of local products are not making enough noise to advertise their products. Customers end up not being aware that their products might be marginally cheaper than imported ones.”
A trader who operates a small one-stop shop on the outskirts of the Central Business District and largely sells foreign products said local goods had become competitive.
He also attributed the price difference to stringent excise duty enforcement.
“Most of the basic commodities were being smuggled into the country while at times we negotiated with Zimra officials at border posts to avoid paying duty.
“But the systems at the border are now more stringent and most people are paying duty.”
Buy Zimbabwe Campaign marketing manager Mr Gabriel Choga was disappointed that some Zimbabweans still preferred imported products despite the price differences.
“People should start appreciating our local items which are now found in shops and are affordable,” he said.
Imported basic commodities, especially from South Africa, have flooded the country following the near-collapse of the domestic manufacturing industry.
Although manufacturers are still struggling, a good number of Zimbabwean goods are back on supermarket shelves, thanks mainly to the introduction of the multi-currency system in 2009.
