Zimbabwe: Diplomatic Shops Ideal

Source from:  The Herald (Harare) 5 September 2008 09/09/2008

TWO Zimbabwean women passed through South Africa's Oliver Tambo airport security check points on their way back home and were asked to step aside and open their bags after the machines had detected unusual items in their luggage. What came out were items such as bread, powdered milk, eggs, candles and matches. Officials at the check point said something in their vernacular language which I managed to translate as referring to the fact that these women were obviously Zimbabweans going by the contents in their bags for no other travellers would carry back home eggs or bread rolls in place of the usual souvenirs. I did not understand every word of what they said but the talk was to the effect that Zimbabwe was a country going through serious challenges as reflected by the amount of groceries that travellers from this country were bringing back home. It had become easy in recent years to discern a Zimbabwean traveller going by the nature of their luggage while in wholesale shops those with the fullest trolleys had to be Zimbabwean. The tax refund queue in the departure lounge a few metres away comprised more of Zimbabweans than any other nationality, reflecting the huge amounts of money that people from this country were spending outside because of the shortages back home. A visit to Roadport would indeed attest to the fact that on a daily basis large amounts of groceries, clothing, electricals and other items are being imported for consumption and for resale. In most instances these are being sold in rand or US dollars. By the way it is now commonplace that even such items as chicken, pork, chocolates, sugar beans, cement and other building materials are being sold in foreign currency as many seek to maintain the value of their wares given the hyper-inflationary environment. It is illegal but it is happening big time. Most people in the diaspora are sustaining their families by sending foreign currency back home and these funds are then used for shopping trips in other countries. Only recently SA released statistics to the effect that Zimbabwe was importing consumables worth billions of rand per year. Other regional countries such as Mozambique, Botswana, Zambia and Malawi have also benefited in the process. Investigations would show that the bulk of the money sent back home through Homelink and other Money Transfer Agencies is being "externalised" through the shopping trips. The said shoppers may not really be to blame in this instance. They have been left with little choice going by the almost empty shelves in supermarkets and other shops countrywide. In instances where products are available, they are selling at exorbitant prices, making it cheaper to do groceries in neighbouring countries. While such escapades have sustained the majority of families in this country, the externalisation of large amounts of foreign currency, have, on the other hand, compromised the country's ability to purchase other critical imports. It is in this regard that we feel the introduction of diplomatic shops as proposed by diplomats and this week by the Confederation of Zimbabwe Industries holds water. These shops would have to be well-stocked, affording those with foreign currency, the opportunity to stock their pantries without having to travel abroad. Presently foreign currency is no longer a preserve of the nouvre-rich but a lot of diaspora money, much of it unrecorded, is floating around. These funds could benefit the country more if captured through such avenues as the proposed diplomatic shops. The parallel market has proved difficult to crack but some of the foreign currency in the informal market can find its way into the official system through these shops. One may not necessarily need to plan trips to purchase flour, soap and cooking oil if these are readily available in the diplomatic shops at a fair price. As correctly pointed out by CZI president Mr Callisto Jokonya, Zimbabweans have been allowed to receive money from the diaspora legally but have been unable to use their free funds legally to purchase goods in foreign currency. "Instead they embark on expensive trips to neighbouring countries such as Botswana, South Africa, Mozambique and Zambia to buy goods that would sometimes have been exported from Zimbabwe, using the foreign currency accessed through our local transfer facilities," he said. I have noticed shoppers going to Zambia or South Africa to buy Schweppes orange crush which is produced here, among other products. The responsible authorities should stand guided and move fast in setting up the diplomatic shops, a phenomenon that has been adopted in other countries before. When the Reserve Bank of Zimbabwe Governor Dr Gideon Gono met diplomats for the traditional monetary policy briefing in May, the issue of setting up such shops was raised as a strategy that could meet the shopping requirements for diplomats, NGOs and the generality of Zimbabweans with access to foreign currency. Dr Gono promised to deliberate on the issue with the Minister of Finance Dr Samuel Mumbengegwi. We hope Government will buy into the proposal. Only last week Dr Gono told exporters that lack of foreign currency was the root cause of most of the country's economic ills. It, follows therefore, that Zimbabwe should implement strategies that ensure it does not lose unnecessarily, any foreign currency that comes into the country. The generation and management of foreign currency allocations is, therefore, central to economic turnaround efforts. Free funds in the hands of many should end up in the formal purse in one way or the other to fund critical purchases and strategies to recapitalise industry, among other needs. FERTILIZER PRODUCTION Reports coming from the fertilizer industry are that production has intensified as producers race against time to meet critical deadlines. So far 13 500 tonnes have been produced out of a possible 32 500 based on funds allocated so far by the central bank. While the efforts by the sector are commendable (albeit after stern warning from President Mugabe), this sector should be the first to realise that there is still a huge deficit given that national requirements per season stand at about 560 000. We understand that imports are being made parallel to local production but it is time we reminded all companies that feed into the agricultural sector, particularly input providers, that time is now running out. We hope this time around the story of late disbursements of inputs will not be repeated. Most subsectors that include tobacco, soya beans, maize, cotton, horticulture and others have pledged to give their best short this season stressing though that this will depend on timeous provision of inputs, critical among which is fertilizer. We, therefore, expect fertiliser producers to redouble their efforts. Of course this sector has not been spared by challenges in the economy but we hope most of these have been dealt with following the provision of foreign currency, which fertilizer producers are now receiving on a monthly basis from the central bank. Seed producers and chemical suppliers should have their matrix in place by now to ensure that the 2008/2009 season does not experience another false start. Zimbabwe Farmers Union president Mr Silas Hungwe said communal farmers were ready to produce a minimum two million tonnes, enough to feed the nation, if they receive inputs on time hence the need to do so can never be overemphasised. Lets learn from past mistakes as stakeholders and demonstrate that we have emerged wiser. In God I trust! Enditem