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Zim 'eases price controls'
Angus Shaw, News 24
September 01, 2007

http://www.news24.com/News24/Africa/Zimbabwe/0,,2-11-1662_2175513,00.html

Harare, Zimbabwe - The government has ended a price freeze affecting hotels, restaurants and bars, citing "viability" problems in the already ailing tourism and hospitality industry, allowing them to increase their rates by up to 50%, the state Herald newspaper reported on Saturday.

Prices of accommodation and meals had been slashed by half two months ago under a sweeping decree meant to tame inflation of more than 7 600% by ordering price cuts on all goods and services. The new tariffs, announced by the Zimbabwe Tourism Authority, will initially be valid until September 30.

At least 7 500 business executives - including corporate directors, store managers, traders and bus drivers - have been arrested, briefly jailed and fined since the June 26 price cuts.

The countrywide Nando's spiced chicken take-out franchise has shut down its outlets frequently since June as chicken, potatoes for fries, cooking oil and diesel for generators ran out during daily power outages.

Fastfood outlets, bars and night clubs were included in a list of new prices published on Saturday, and hotel accommodation rates were raised according to their star rating.

Five star hotel room rates were listed at about the equivalent of US$60 a night for Zimbabweans, but remained at about US$200 for foreign visitors under a long-standing two-tier system differentiating the two.

Saturday's price list raised the price of beer and liquor by about a third in hotels, bars and restaurants, but not in shops and liquor stores.

The tourism authority said the increases were agreed taking into account the government's pricing policy "as well as the viability of the tourism industry".

Tourism revenues, once the nation's third-largest hard currency earner after tobacco exports and mining, have plummeted in seven years of political and economic turmoil that followed the often-violent seizures of thousands of white-owned commercial farms that began in 2000, disrupting the agriculture-based economy in the former regional breadbasket.

Along with acute food shortages in recent weeks, Zimbabweans have faced shortages of beer and cigarettes in a nation once the world's second biggest tobacco exporter after Brazil.

Independent estimates put real inflation closer to 25 000% and the International Monetary Funds has forecast it would reach 100 000% by the end of the year, fuelled by rampant black market dealing in scarce goods.

A cattle auction at the annual Harare agriculture show was banned by price control authorities on Thursday, after it became clear bids were to exceed the government's price by several fold in the beef-eating nation where meat has become a rarity.

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