Zimbabwe plans to lift price controls

By Tichaona Sibanda
6 September 05

The government is to lift price controls and allow market forces to determine prices of goods, Finance minister Herbert Murerwa announced on Monday.

No date for the deregulation has been given, but it is expected that once it comes into effect, price controls will be lifted on basic commodities such as food and fuel.

Political analyst Bekithemba Mhlanga has warned that the dumping of price controls in a volatile economy like Zimbabwe's, could lead to unprecedented price increases.

This would have a direct bearing on the livelihood of many Zimbabweans, already suffering under the harsh economic climate. Price controls weere introduced by government two years ago as a measure aimed at curbing inflation.

In submissions made before a Parliamentary Portfolio Committee on Budget and Finance, Murerwa said price controls were not helpful to the country.

He said; 'We should move away from price controls. They do not help. It is some of these policies that are creating additional distortions. We are a globalized village,'

There is speculation that controls will remain on a number of politically significant and strategically important items such as maize meal and fuel. Sources said the Zanu (PF) government still views control and manipulation of these commodities as vital to their political survival.