Dairibord, Lobels and Saltrama chiefs arrested over price increases

By Lance Guma
18 September 2006

Three directors from Zimbabwe ’s largest milk supplier Dairibord, bread maker Lobels and Saltrama Plastics were arrested on Friday and Saturday respectively over so-called unsanctioned price increases. Dairibord chief Benson Samudzimu was arrested Friday morning after the wholesale price of milk went up from Z$185 to Z$250. Samudzimu is expected to appear in court soon, according to the Herald, although no specific date was mentioned.

Lobels operations director Lemmy Chikomo was arrested Saturday afternoon after the company raised the price of bread from Z$200 to Z$335 for a loaf. The managing director of Saltrama Plastics Edward Madza was also picked up. It’s not yet clear why the Saltrama boss was arrested since plastics do not fall under the same category of essential items like milk and bread. All three were held at Mbare Police station over the weekend. A Herald report says they will all be charged with increasing the price of goods without authority from the Ministry of Industry and International Trade.

Police spokesman Andrew Phiri confirmed the arrests to the state media saying it was an ongoing operation and that over 200 police officers had been deployed to monitor prices in the shops. Interestingly a stand-off between government and fuel dealers over prices also remains unresolved but no arrests have been made. It’s thought the majority of contracts for selling fuel were given to Zanu PF bigwigs and any arrests would ruffle a few feathers higher up the hierarchy.

Economic experts however dismiss government’s price crackdown as an attempt to treat the symptoms rather than the disease. Manufacturers in the country have to operate in an environment with over 1200 percent inflation, dominated by acute foreign currency shortages. A dwindling agricultural production base, caused by a violent and disorderly land grab, have all compounded to kill off the economy, leaving it relying more and more on imports.