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Consumer basket soars
Kudzai Chawafambira, The Herald (Zimbabwe)
February 06, 2006

http://www.herald.co.zw/inside.aspx?sectid=159&livedate=2/6/2006 12:00:00 AM&cat=8

JANUARY’S consumer basket for a family of six increased by 30,7 percent to $21,8 million from the December figure of $16,6 million.

According to the Consumer Council of Zimbabwe (CCZ), the rise was largely attributable to significant price increases affecting both food and non-food items.

Major movers in the basket were the maize staple roller meal, which went up by 138 percent from $240 000 to $573 333 for a 20-kilogramme bag, electricity and water charges (73,4 percent), clothing and footwear (107 percent) and rentals (52 percent).

"Although there were notable increases in food items of the basket, major percentage increases were (also seen) in non-food items.

"Water tariffs were increased from the beginning of the year, the costs of clothing and footwear increased and recently transport costs shot up.

"It is still disheartening to note that some goods are yet to find their way onto the shop shelves.

"Commodities like roller meal and sugar are not constantly available on the formal market and, as CCZ, we urge all the relevant players in various industries to ensure the efficient supply to the formal market of the two commodities," said the consumer watchdog.

The year 2006 started on a low note. In spite of the reduction in value added tax (VAT), consumers are still battling with continuous price increases.

"From a background whereby VAT was decreased by 2,5 percent at the beginning of the year, the price increases raise eyebrows because, in essence, as a consumer watchdog we would have expected evidence of the VAT decrease.

"If retailers had effected the VAT decrease, there would not be such a huge increase in the total of the family basket," the CCZ noted.

Economic analysts say a new round of price increases would aggravate the plight of the consumer and exacerbate inflation, currently running at 585,8 percent.

However, the consumer watchdog urged consumers not to despair, but to await the outcome of the Tripartite Negotiating Forum (TNF) negotiations, which made a promising resumption last month.

The CCZ called on all the three parties to the Incomes and Prices Stabilisation Protocol (Government, business and labour) to speedily come up with an effective solution to the current market distortions.

The consumer watchdog’s low-income urban monthly basket reflects that many families are becoming increasingly vulnerable to poverty and hunger as shortages of basic commodities continue unabated and price rises occur almost on a daily basis.

Surveys for the consumer basket are conducted twice a month while the basket is calculated by averaging the prices of goods from retail outlets throughout the country.

The CCZ’s basket accurately depicts the cost of living in Zimbabwe and if it were adopted as the official Poverty Datum Line (PDL), millions of families would be classified as living in abject poverty.

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