The Sunday News
Profiteering is described by some writers as “disproportionately large or grossly unfair profit, generated often through manipulation of prices, abuse of dominant position, or by exploiting a bad or unusual situation such as temporary scarcity.”
Profiteers famously take advantage of things like scarce food, disparities on the market or ongoing conflicts to make a lot of money. The word existed but wasn’t commonly used in English until World War I, when journalists started talking about “war profiteers” who benefited financially from shortages and desperation.
The practice is by any definition unprofessional, unethical and even criminal, as it is meant to take advantage of a situation and fleece citizens of their hard earned cash. It also has far reaching consequences as it can be used by political and social activists to coerce masses to turn against governments as people feel the pinch of biting prices.
We are faced with such a scenario in the country where service providers and retailers are increasing prices willy-nilly without any backing from the books of economics. President Mugabe has spoken strongly against such practices, and more efforts need to be taken to bring back normalcy particularly in the retail sector where prices of basic goods have been going up on daily basis. Some claim it is because of shortages of foreign currency, but as we pointed out last week, even those dealing in goods manufactured locally have also joined the band wagon.
Our sister paper, Chronicle reported last week that pharmacies have hiked drug prices by up to 70 percent over the past three weeks and some are demanding payment in United States dollars only. In a statement, the Association of Healthcare Funders of Zimbabwe (AHFoZ) said it had engaged the Retail Pharmacies’ Association (RPA) to try and resolve the problem.
“The AHFoZ wishes to advise medical aid members that most pharmacies have increased the price of drugs by between 30 percent and 70 percent over the past three weeks. Some pharmacies are charging huge shortfalls, while some are insisting on cash payments in United States dollars and rejecting medical aid cards as other payment methods such as by debit card EcoCash or bond notes.”
AHFoZ said following deliberations with the RPA, they have since engaged the Reserve Bank of Zimbabwe to seek an allocation of foreign currency so that pharmacies can revert to previous prices. But the Central bank is on record as saying a substantial amount of money was being allocated weekly to pharmacies for importing drugs,US$4 million to be precise, which means those increasing prices are being criminal and just like retailers of basic goods, have sinister motives, we presume.
In a survey carried out by this publication recently, it emerged that some retailers are sabotaging the economy as they have maintained high prices for locally produced goods although manufacturers of the goods never increased prices. The retailers increased prices of most goods after 23 September citing increased demand after consumers went on panic buying following social media frenzied lies insinuating that the country was headed for shortages because of foreign currency shortages.
However, the situation normalised after the Reserve Bank of Zimbabwe chipped in with increased foreign currency allocations to support critical sectors. It also emerged that the social media statements were lies meant to create panic buying of basic commodities. What has also emerged is that even after manufacturers have increased production and are now meeting demand, retailers who do not need foreign currency to acquire locally manufactured goods have maintained high prices. Confederation of Zimbabwe Retailers president Mr Denford Mutashu acknowledged that some retailers were ripping off consumers.
“We are quite aware of what is going on and we are seized with the matter. What we have done is to engage the Government to ensure that the situation normalises. Some retailers have a multi-tier pricing system, different prices for cash and plastic money purchases. That should stop. Retailers should always observe best practices,” he said.
We urge the Cabinet Taskforce which was appointed to look at the price situation to move with speed and bring back normalcy.
