There is news that the Harare City council wants to increase the cost of water to residents from the currenct $0.80 per cubic metre of water to $7 cubic metre. If approved it means the water levies would have increased by just over 900%!
The latest episode in a world of never-ending price increases
Zimbabwean consumers are used to it now, every morning has not been a good morning for a while as various sellers and service providers have been increasing prices virtually every week and day. The Harare City Council has been one of those service providers which hasn’t been exactly shy when it comes to effecting price hikes.
On multiple occasions, the council has increased prices of services and fines citing inflation and foreign currency fluctuations. Towing and parking fees were also significantly increased (by 1000%) in the last supplementary budget which council had to come up with following the central government’s final admission that the 1:1 set up was fiction in February.
The foreign currency effect
There have been water shortages in most parts of Harare which has been blamed on a number of factors including the 2018/19 drought season as well as shortage of treatment chemicals which have to be bought using foreign currency.
Ever since the introduction of the interbank rate, the Zimbabwean dollar has only gained value on a few occasions. While it started at $2.50 ZWL per $1 USD it has plummeted to $15+ ZWL per $1 USD. This has resulted in round after round of price increases as businesses try to chase this rate.
Things are made worse by the fact that most items sold in local stores are imported. The cost of chemicals and equipment parts is directly affected by this rate. Unfortunately, if there is an increase it will in water levies it will affect even locally made products.
The council has also proposed charging rates in foreign currency for certain customers which are yet to be specified.