The Zimbabwean government will tomorrow (Monday 9 December 2019) gazette yet another Statutory Instrument. This one will deal with the pricing of maize-meal on which the government removed and then reinstated subsidies. According to the government, roller meal is now supposed to sell at $50 ZWL per 10kg. Currently, it is still selling at $100 ZWL in most shops.
One of your grievances raised here was that of price increases. You already know what we have done by reversing the price of mealie-meal. We reversed it on Wednesday and we are going to gazette a Statutory Instrument by Monday (tomorrow) to reduce mealie-meal to $50.
We are now going to fix the price of mealie-meal so that it is affordable to the ordinary people and we pay the difference through the subsidy. In addition to that, we have also chosen about seven basic commodities which we are going to subsidise. These are basics used by a traditional family, and we want these basic foods to be cheaper. For example, if a product was selling for $20, you will buy at $12, then Government will pay the remaining $8 so that people can buy at a low price.
What other products are likely to be subsidised?
Well, it’s not clear yet what exactly the seven basic products that are going to be subsidised are. However, in times past the government has flirted with the idea of setting up Silo (sometimes called People’s Shops) in rural areas to sell basic commodities at low prices using a voucher system.
In that instance, some of the productions mentioned as basics included
- Bread (the government has really struggled on this one)
- Cooking oil
What about the People’s Shops
Last time we were told that close to $70 million funding had been secured to fund the establishment and running of the Silo shops, whatever happened to those? Are they being replaced by the subsidies instead? To be honest, subsidies are much better than a voucher system that is prone to be abused by the well connected who will buy products at government prices and resell them on the black market.
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