Mnangagwa swoops on cartels and monopolies over pricing

Mnangagwa swoops on cartels and monopolies over pricing
Published: 16 June 2019 (221 Views)
GOVERNMENT has begun enforcing a combination of strategies to break monopolies and foster competition among companies in key sectors providing basic commodities, which have come under siege from price cartels so pushing products beyond the reach of many.

This comes as Parliament has invited Industry and Commerce Minister Mangaliso Ndlovu to furnish it with a comprehensive explanation on the wave of price increases plaguing the economy.

The Sunday Mail has gathered that authorities are urgently finalising reforms to the Competition and Tariff Commission (CTC) that will usher a new environment for fair business practices whilst introducing punitive action against unethical profiteering.

The development also comes amid indications the much awaited Consumer Protection Bill, to enhance and safeguard the rights of shoppers, will be signed into law within the next month.

In an interview, Minister Ndlovu said a report by the CTC had uncovered monopolies to be behind the price distortions particularly of sugar, poultry and dairy products.

"Monopolies are a big problem in our economy.  They stifle innovation. You can see what is happening in our economy in terms of monopolies," he said.

"CTC did a snap survey and the full report, at the moment, is confidential. However, they found out that the food sector, in particular, is monopolised to the extent that some control and manipulate prices on the market.

"They have also given recommendations which we have started instituting. That is why you see that the Government recently approved the Zimbabwe National Industrial Development Policy to promote competitiveness."

Minister Ndlovu said the major measure to break monopolies was funding for other players to set up shop and stimulate competition.

He said the approved principles of the amendments of the CTC included empowering the commission to levy companies that violate competition laws.

The introduction of the Zimbabwe National Industrial Development Policy last week would also help bring competitiveness in the economy.

He said the Consumer Protection Bill was expected to become law next month and that seeks, among other objectives, to criminalise retailers and manufacturers who sell goods on condition that customers buy other products from the same shop

According to the Bill, it is an offence for retailers; "not to display prices of goods on shelves."

The initiatives to arrest unwarranted prices comes as Parliament  this week seeks explanations from Minister Ndlovu on the pricing models for goods and services.

Last week, National Assembly members condemned businesses for wanton price hikes.

Responding to a point of privilege raised by Chegutu West legislator Dexter Nduna, Deputy Speaker of the National Assembly Tsitsi Gezi invited Minister Ndlovu to discuss the pricing issues.

"We will call the Minister of Industry and Commerce to come and give us a ministerial statement on the issue of prices," she said.

Nduna said Minister Ndlovu should explain  why  the increase in prices of goods and services had persisted unabated.

"I ask if the Minister of Industry and Commerce could come to this House. It would be prudent for him to come and favour us with a ministerial statement as to why the arms of industry, industry players and business people, in particular those big businesses, are sky rocketing prices of cooking oil for instance; which they buy at a very low wholesale price," he said.

"I am quite shocked that some basic inputs and necessities such as cooking oil, sugar and other needs are changing in price each day.  Nduna said businesses should be challenged to provide empirical evidence justifying the price hikes.

He proposed that those that fail to do so should be arrested and prosecuted.

- sundaymail

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