Zimbabwean Vendors Allegedly Sell Goods In Foreign Currency, With Help From Big Retailers

4 months ago
Tue, 23 May 2023 07:27:07 GMT
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Zimbabwean Vendors Allegedly Sell Goods In Foreign Currency, With Help From Big Retailers

Vendors in Zimbabwe’s major cities and towns have taken over strategic points, including the verandas of large retail shops, to sell a variety of goods, including basic commodities in foreign currency. This chaos has emerged amid rumours that the vendors’ biggest suppliers are large retailers who are chasing the United States dollar, which is available on the parallel market.

Some retailers are reportedly refusing to transact in the local currency due to various excuses, such as malfunctioning point-of-sale machines.

Consumer Council of Zimbabwe (CCZ) executive director Rosemary Mpofu confirmed reports of the failing electronic payment system. She told NewsDay:

CCZ of late has been receiving consumer complaints from the transacting public, among them retailers charging some products exclusively in US$ only, and rejection of the  Zimbabwean dollar, notably mobile transactions either by phone or swipe cards.

At times, consumers are advised that either the mobile network is poor or lack of connectivity, and non-functioning swipe machines in a bid to harness as much forex from consumers. We appeal to retailers practising such unethical practices to desist as such a move impacts on consumer spending, and limits rights to choice as we are using a dual currency system. The Zimbabwe dollar remains legal tender, that should not be rejected until such a time monetary authorities advise so.

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Denford Mutashu, the president of the Confederation of Zimbabwe Retailers, stated that some unscrupulous businesspeople are responsible for the recent price hikes, which are an attempt to sabotage the government before the general elections. Mutashu described the unwarranted price increases as unnecessary and uncalled for. He also noted that some retailers are deliberately withdrawing point-of-sale machines to reject payments in the local currency. Mutashu said:

Our position is that retailers should continue accepting the local currency as legal tender. The situation right now is very normal as we are approaching elections. We have a situation where business has suddenly rejected the local currency. It’s difficult to understand the sudden overcharging of goods and services where the parallel market rate has shot up to US$1: $4 000 against the official exchange rate of US$1:$1 500.

Over the weekend, several major shops and bars in Harare’s residential areas refused to allow consumers access to point-of-sale machines. Some large retail shops announced electronic payment system failures for customers transacting in the local currency via radio paging systems.

Zimbabwe has adopted a dual currency system in recent years, allowing for transactions in both the Zimbabwean dollar and the US dollar. However, the growing demand for the US dollar has raised concerns among industry leaders. Denford Mutashu warned that if left unchecked, this demand could lead to a full-time dollarization of the economy. To prevent this outcome, it is essential for all stakeholders to comply with currency laws, promote financial inclusivity, and protect consumer rights.

A Twitter account, purportedly belonging to President Emmerson Mnangagwa’s spokesperson George Charamba, has referred to the recent events as “false chaos.” The account accused manufacturers and large retailers of deliberately sabotaging the government. Read the Twitter posts:

FALSE CHAOS: Behind this seeming chaos is the methodical BIG HAND OF BIG BUSINESSES!

They use forex cheaply got from the auction to retool, order raw materials, manufacture, and then redirect their output into the informal sector through their AGENTS. The net result is complete dollarisation they falsely claim hurts them; and evasion of taxes for the very government that nourishes them. #ThisMadnessMustBeStoppedNow!

The Zimbabwean government has attempted to downplay the currency crisis, stating that it has engaged with the industry to control the soaring prices of basic commodities. In his weekly column for a state-owned newspaper, President Mnangagwa accused the business sector of betraying government efforts to stabilise the economy.

The Zimbabwe dollar has been rapidly losing value, and some supermarkets are pricing their goods exclusively in US dollars to avoid losses. Prices in local currency have been fluctuating daily, leading to panic buying by consumers.

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