Zimbabwean retailers are currently grappling with restocking locally produced goods due to currency-related challenges.
As reported by <a href="https://www.newsday.co.zw/local-news/article/200024355/shortages-loom-as-basics-disappear-from-shelves">NewsDay</a>, manufacturers and wholesalers are favouring transactions in United States dollars (USD), which has led to difficulties for retailers buying in the local currency.
The Zim dollar has experienced significant depreciation against the USD, prompting discussions about the potential full dollarization of the economy.
As a result, retailers have encountered prolonged periods without the supply of essential locally produced commodities. Critical shortages of items like sugar have been reported.
Speaking to NewsDay, Denford Mutashu, the president of the Confederation of Zimbabwe Retailers, said that the supply chain for basic commodities has become dollarized.
Mutashu said this situation has left retailers who buy in local currency facing difficulties in maintaining their stock levels. He said:
<blockquote>
The biggest challenge is the currency that one uses to source products at the procurement level.
Manufacturers do not want the local currency. Generally, the appetite for the US$ in the market is high.
The supply chain is 90% dollarised, and for the formal stores, it becomes very difficult because they are the only ones that are still selling to the customers in local currency.
So, with a huge local currency balance, running a retail business in this current environment is difficult.
Manufacturers also indicate that most of their suppliers for raw materials or services are demanding payment in US$ and that is why they demand US$ when they sell their products.
It’s a glitch that is happening. That is why most formal retail shops are failing to stock up. Those products are in the informal market.
</blockquote>
As of 14 March 2024, the Zim dollar was trading at 1:17 830 against the United States dollar at the interbank market and 1:18 500 in supermarkets, while it stood at 1:20 000 on the parallel market.
Meanwhile, Consumer Council of Zimbabwe (CCZ) director of corporate affairs Philemon Chereni said that prices of goods and services had gone down in US$ terms as operators were offering discounts to encourage foreign currency transactions.
Chereni said the cost of living for a low-income urban-earner family of six, as measured in USD, decreased by 1% from US$551.38 to US$544.71.
He said the stability of the basket’s overall cost is partially attributed to the discounts applied when paying in USD.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

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Manufacturers Do Not Want Zim Dollar, Supply Chain Is 90% Dollarised - Retailers

High Court judge Justice Gladys Mhuri has ordered Harare Polytechnic College to stop demanding payment of tuition and other levies exclusively in United States dollars and accept payments from students in RTGS at the prevailing interbank rate.
According to <a href="https://www.newsday.co.zw/news/article/200022506/court-orders-harare-poly-to-accept-rtgs-payments">NewsDay</a>, this comes after some students, through the Zimbabwe Lawyers for Human Rights (ZLHR), challenged the move by Harare Polytechnic College, arguing that the mode of payment was discriminatory and a violation of the country’s exchange control regulations.
The student application was filed on 25 January in response to a circular issued on 12 January 2024.
The college had ordered students to pay tuition, catering and accommodation fees exclusively in United States dollars.
To facilitate payments, Harare Polytechnic College only provided a United States dollar-denominated account, leaving no room for payments in the local unit.
Late last year, the Government enacted Statutory Instrument 218 of 2023 which extended the use of the multiple currency system to December 2030.
The law compels businesses and individuals to accept the Zimbabwe dollar and a few other foreign currencies in domestic transactions.
Economists estimate that 80% of the local economy is dollarised, with the gap between the official and exchange rates continuing to widen.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

High Court Orders Harare Polytechnic To Accept Zimbabwe Dollar Payments

The Reserve Bank of Zimbabwe Financial Intelligence Unit (FIU) said that retailers and manufacturers who were exclusively charging certain goods in foreign currency and using the street market rate for currency conversion have agreed to reconsider their pricing models.
In an interview with <a href="https://www.sundaynews.co.zw/16-bank-accounts-frozen-in-rbz-price-blitz-overpricing-shops-penalised/">State media</a>, FIU director-general Oliver Chiperesa said that the Unit has received assurances from retailers that they will adjust their prices in line with the prevailing official exchange rate while also accepting Zimbabwe dollars for all products. Said Chiperesa:
<blockquote>
We engaged with them and they have assured us that they are relooking into their pricing models.
Yes, some had items that they were not allowing clients to pay for using the local currency, but we have told them that is not acceptable and they agreed to rectify it.
They also assured us that customers will be able to pay in local currency for all goods whose prices have been marked in foreign currency only.
</blockquote>
He, however, said there were still some rogue businesses who they continue to monitor to ensure that they were brought to book.
Chiperesa gave an example of one supermarket in Belvedere, Harare, saying it had a rate higher than the parallel market. He said:
<blockquote>
On Friday we found out that this supermarket was using an exchange rate of US$1:ZW$10 000 which has no relationship with even the parallel market.
So it is just a rate they came up with as forward pricing just to destabilise the rates because the most extreme parallel market rates were 8 000, but they are beginning to go down.
</blockquote>
Last week, the RBZ set the official exchange rate at US$1: ZW$5 900 while the street rate was hovering at US$1: ZW$9 000.
However, some large retailers were using at least US$1: ZW$10 000 for selected products while popular fast-food outlets were rejecting the local currency on the pretext that their point-of-sale machines were not working and therefore could not accept swipe and EcoCash payments.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Shops Agree To Sell Products In ZimDollars At The Official Rate - RBZ

The Government has warned schools, both public and private, against demanding fees exclusively in United States dollars saying the Zimbabwe dollar remains legal tender.
In a press statement released on 12 May 2023, the Ministry of Primary and Secondary Education said parents and guardians should be allowed to pay fees in local currency calculated against the prevailing bank rate. The Ministry said:
<blockquote>
The Ministry of Primary and Secondary Education has noted with concern the demand for school fees and levies in USD by school authorities.
For this reason, all public and private schools must accept all forms of currency payment obtaining in the country for school fees and levies.
Therefore, the demand to receive payment exclusively in USD is not permissible and is contrary to the laws of the land.
For the record, the Zimbabwe dollar is still the legal tender in the country.
Parents/guardians should therefore be allowed to pay fees and levies in Zimbabwean dollars.
Parents/guardians opting to pay school fees in USD or in Rand should be allowed to do so calculated against the prevailing bank rate on the authorized fee and levy structure.
As a matter of fact, no school; public or private should charge fees without the approval of the Ministry of Primary and Secondary Education.
The Ministry of Primary and Secondary Education remains committed to the education of all pupils at institutions that provide primary and secondary education as we strive to provide quality and relevant education to all Zimbabweans.
</blockquote>
The Zimbabwe dollar is increasingly becoming unattractive for businesses and services providers as continues to fall rapidly against other countries in use in the country such as USD, Rand and Pula.
As a result, both formal and informal sectors are demanding payments in foreign currency and where the Zimbabwe dollar is accepted, in most cases the black market rate is used which is more than double the official rate.
More: <a href="https://www.pindula.co.zw/">Pindula News</a>

Govt Says Forex Only School Fees Illegal

<blockquote>Members of the public should feel free to move from one place to another as police are providing adequate security to business, schools, colleges and residential areas.
In the same vein, supermarkets and shops are implored to display commodity prices in order to allow.
members of the public to access goods and services in an environment which gives them room to plan, coordinate and buy the items freely without any form of manipulation by unscrupulous dealers.
The ZRP warns all those who are charging commodities in United States dollars that they risk being arrested as the law will be applied without fear or favour.
Members of the public should report such people to any nearest police station or the National Complaints Desk on telephone numbers 0242-703631 or WhatsApp number 0712800197.</blockquote>

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