I just updated on The Bearded Man about an article on the SABC where the Zimbabwean government has apparently crumbled on the forced price slash.

The example given was cooking oil that, having had its price halved, has now been allowed a 400% increase…

Let’s have a closer, calculated look at that decision. Let’s suppose that the bottle used to sell for ZW$10000 (I wish!) and in light of the Presidential order it was reduced by half to ZW$5000…

Today the government has accepted a 400% increase which means the new selling price is ZW$20000.

The nett effect is a 100% increase on the original price.

So the government is doing a total 180 degree turn about, but on SELECTED goods only and the knock-on effect is that prices before the order are doubled! So what did the order do – apart from causing a huge hole in the market, angering a lot of company owners, causing losses aplenty in the market AND lightening the load in quite a few wallets in the form of fines?

The good people of Zimbabwe went on a spending spree and may have saved a few bucks, but this is short lived.

The price stabilisation order (as they like to call it) was total waste of time and effort - and achieved nothing. The story of ZANU PF’s rule…

Take care.

‘debvhu