Industry Under Siege
BUSINESS REPORTER
The Financial Intelligence Unit (FIU) has pounced on suppliers and manufacturers countrywide who refuse or impede Zimbabwe Gold (ZiG) transactions fearing that their actions could lead to fresh volatility in the exchange rate and inflation rate.
FIU has since frozen the offending manufacturers and suppliers’ accounts.
Oliver Chiperesa, the director general of the FI, said dealing with the manufacturers could help bring about long-term stability in the ailing economy.
“We started this targeted exercise against manufacturers last week and we have frozen the accounts of several industry players and penalised them. They have paid penalties and we will monitor if they are now in full compliance,”Chiperesa said.
He added: “We are targeting more and more this week as we act on reports we are getting from the retailers.”
The development comes following the FIU’s recent raids on retailers.
The retailers, Chiperesa asserted that they were at the centre of the pricing regime as they face consumers every time of transaction.
Chiperesa said the retailers suffered more as they were the ones who were responsible for direct goods pricing.
He claimed that the retailers held the manufacturers and suppliers responsible for all price manipulation in the market.
“One area that remains of concern to us are some manufacturers and suppliers who still restrict the amounts of ZiG that they receive from downstream traders.
“We are using both engagement and enforcement against them. We have already frozen the accounts of a handful of manufacturers and penalised them,” Chiperesa said.
“We are expecting compliance levels to continue to increase in that sector, which will in turn have a cascading effect down the supply value chain and ultimately benefit the consumers,” he said.
It also comes after the FIU dragnet caught over 500 foreign currency manipulators.
He said cumulatively 534 accounts were frozen,161 were penalised with 12 caught between Monday and Tuesday this week.
He said that certain offenders would be precluded from using financial services for a considerable amount of time.
An official from the country’s biggest lobby business group, the Confederation of Zimbabwe Industries , said the manufacturers were merely charging prices that allowed them to keep on producing.
The official said those prices were not exorbitant.
“We are charging a price that allows us to continue producing, we can’t charge a price that will see us close shop again. There is a need to engage so that we can have a common understanding,” the official told Business Times.
Manufacturers accused the FIU of harassing struggling companies to impose “price controls”.
According to analysts , companies are being targeted at a time when they are battling numerous economic headwinds.
The FIU operation coincides with an awareness blitz on errant millers who are selling underweight mealie meals.
“We will be going into the market with the Ministry of Industry, Consumer Protection Council, Trade Measures Board, Joint Operations Command and Minister of State for Bulawayo in our instance although it’s a country wide initiative. The thrust is self-regulation of the private sector and ensuring consumers get their monies worth and compliance with standing regulations,” the Grain Millers Association of Zimbabwe said in a statement.
According to Millers, there has been a crackdown this week on errant millers who are packing eight kilograms of mealie meal in ten kilogram bags, shortchanging clients.