The Zimbabwean government has ordered businesses not to increase prices until later this month when the changeover to the newly introduced currency is complete.
The order comes in the wake of last week's dropping of three zeros on all denominations of Zimbabwean currency. Instead of adjusting prices accordingly, some traders saw the change as an opportunity to hike prices.
Minister of Industry Obert Moyo said the directive was effective from August 1, when the new currency came into circulation. The freeze will be in force until August 21, when the changeover is supposed to be complete. He warned businesses that flouted the law face a heavy fine. He ordered businesses that had increased prices to revert to the prices before the announcement of the currency revaluation.
A supermarket manager who spoke to VOA on condition of anonymity said the price increases were a response to what his business paid to the wholesalers. He said he had no choice but to increase prices accordingly if he is to stay in business giving the example of bread, which is being sold at more than twice the government stipulated price. Shop owners say if the sell it at the government price, they will be making a loss so the would rather risk paying a fine.
Zimbabwe is grappling with its worst economic crisis characterized by the highest inflation rate in the world, high unemployment, regular power outages and shortages of fuel, food and foreign currency. The dropping of the zeros is meant to make it easier for consumers to carry out everyday transactions.
Besides making it easy for consumers the introduction of the new currency was also meant to catch those involved in the foreign currency parallel market flatfooted. The government has put a cap on the amount that can be deposited by individuals and businesses.
Anybody found with more than the respective amounts risks losing their money if they cannot prove they got it through legitimate means. So far the state-controlled daily, The Herald, reports that more than 2,000 people have been arrested for having amounts in excess of the stipulated limits.
Police have mounted roadblocks all over the country and are also manning border posts to intercept those trying to bring Zimbabwean currency into the country
before the expiration of the changeover period. The authorities allege that billions of Zimbabwean currency had been externalized in neighboring countries where they were fueling the foreign currency black market.