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Price increases caught Chinamasa by surprise

by Staff reporter
30 Sep 2017 at 06:51hrs | Views
FINANCE minister Patrick Chinamasa has said he was surprised that during last weekend's panic-buying, many people were seen even hoarding mealie meal.

Chinamasa told guests at the MEJRKH 2017 Mining Media Awards in Harare on Thursday that there was no reason to panic, as all sectors of the economy, notably mining, were on the rebound.

His statement followed the panic-buying that gripped Zimbabwe last weekend which saw prices of basic commodities also going up.

"We have success stories and one of them is that at the beginning of the year coal production was around 30 000 metric tonnes per month, and after we recapitalised Hwange Colliery Company at the end of August, it is now 300 000 metric tonnes per month," Chinamasa said.

"When there is panic-buying and I have these figures, it is surprising because all economic indicators are positive and I was surprised that during the panic-buying people were even buying mealie meal and yet when you go around the silos they are full and there is no way maize can be short."

Chinamasa said when he became Finance minister gold production was at 12 metric tonnes, but over the years it had gone up to 22 metric tonnes.

"In the tobacco sector, there used to be 2 000 commercial tobacco farmers, but now there are 105 000 households growing tobacco. The 2 000 farmers all operated using cheque books, but the 105 000 farmers want physical cash and what kind of economy is that?" he asked.

Chinamasa said Zimbabwe was experiencing cash shortages because everyone, including artisanal miners, wants to be paid in cash.

The Finance ministry has been releasing $5 million every week to pay artisanal miners who deliver gold to Fidelity Printers.

"The international practice is that between 10% to 15% has to be physical cash, while the rest has to be electronic transactions. I have to release $300 million for civil servants every month and they also want that in cash," he said.

Chinamasa said economic indicators in all sectors indicate a growing economy, adding the crisis is unnecessary and is being fuelled by false social media messages.

Source - newsday

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