Zimpapers Logo

Government has set up a Special Cabinet Committee to probe an illegal three-tier pricing phenomenon which has emerged on the market. It came much earlier than the price madness ostensibly triggered by a fake political social media scare that the Zimbabwean economy had collapsed overnight and that in a matter of days shops would be empty. Thousands of otherwise rational people and a majority of so-called poor toiling Zimbabweans fell for this political skulduggery. For a day or two it indeed did appear like the shops would be emptied as people went into a buying frenzy. For the same number of days, it indeed did appear that the country was grinding to a halt for lack of fuel.

No sooner had the authors of this mischief begun to celebrate than normalcy appeared to return. Because the mischief had no basis in reality. But a lot of damage had been done, and will be felt by the ordinary person for a long time. Retailers and other traders not only made hefty profits on the cursed days. They have refused to revert to prices prevailing before the fake news. Prices of some goods tripled overnight and have remained there. One reputable tyre dealer in Harare sells his tyres for $215 if one is swiping. Another dealer sells the same product for US$85, but charges up to $113 if one is using bond notes.

We cannot rule out collusion, or the existence of cartels in the economy. There is no rational explanation for the sudden spike in prices across the board. In some cases the price remains the same whether one uses the bond notes or US dollars, debunking the lie about the bond note losing value against the American currency. Instead, it tells us that the price is deliberately inflated for the bond note, but it’s then convenient for the retailer to have the currencies at par when the customer produces US dollars.

What we are trying to do is to highlight the complexity of the investigation the Special Cabinet Committee is undertaking. It’s not like there will be easy catches, unless all the dealers keep proper books, which show what costs went up overnight in bond notes and US dollars to justify the recent price madness. As usual, there will be the standard blackmail about the shortages of basic consumer goods if Government punishes the criminals. That again demonstrates the collusion and rent-seeking mentality where people want to behave as they please in defiance of economic logic. Government will, therefore, need to act with both fairness and firmness.

At the same time, let’s not forget that there are sections of the private media, which have not stopped celebrating the price rip-off. They behave like they have become active political actors in deciding who should rule the country rather than analysing issues for the public. They are the first to “warn” about the risks of price controls, but are silent when retailers engage in what is clearly economic sabotage. One of the gifts the Creator gave the human being is the ability to distinguish between what is good and what is bad, what is wrong and what is right, what is rational and what is not rational. But he also gave us the mental dexterity to sometimes play devil’s advocate. But this must have a limit.

When mainstream private media always don’t appear to see anything wrong in businesses engaging in political mischief and seek to rationalise and justify it on the basis of so-called rational expectation, and the need for a return on investment, we begin to suspect corruption — that brown envelopes are being passed under the table to defend the indefensible: the classic see no evil, hear no evil and speak no evil when it comes to the operations of private enterprises. Blame everything on Zanu-PF’s bad economic policies and defend acts of sabotage as dictated by rational business logic.

That said, we want to end with a cautionary: Government must deal resolutely with errant businesses, but that should not lead to populist price controls with an eye on elections. That can only play into the hands of the criminals without bringing the votes. So it’s a delicate balancing act: dealing with mischief makers without tipping the scales in pursuit of short-term political gains.

The aim should be to restore sanity to business for the greater good of the economy.