Zimbabwe

Zimbabwe: Bakers demand 100 percent hike in price

HARARE - Zimbabwe's bakers are pressing for a nearly 100 percent hike in bread prices, warning a massive shortage of the commodity was imminent if the government does not urgently approve the review.

This comes barely a week after sugar producers forced the government to review the price of the commodity upwards by 117 percent.

Last week some retailers were already selling a loaf of bread at Z$1 600 - up from the $825 prescribed by the government in December.

The National Bakers Association (NBA) cited incessant increases in working capital as raw material prices continually go up, saying the gazetted price - based on November 2006 cost factors - was "seriously bleeding" the industry.

"As the industry situation stands, the gazetted price is lagging behind by two months and the bread industry is fast grinding to a standstill unless something is done to salvage it," the NBA said in a statement at the weekend. "The ship is now sinking and this is an SOS."

The NBA said the majority of the industry's 20 000 employees could find themselves jobless while more company closures were imminent if the government did not urgently review the price upward.

"Unless the pricing issue is urgently resolved, the future of the industry is bleak and more closures, retrenchments and bread shortages would be inevitable," the NBA said.

The government slapped price controls on basic commodities in a desperate bid to combat hyperinflation - the highest in the world at 1 282 percent in December.

Two of Zimbabwe's senior bakers were in December slapped with four-year jail terms each for breaking price controls by hiking bread prices without government approval.

Officials in the baking industry said they were contemplating withholding bread unless the government entertained their pleas urgently.

Sugar producers resorted to withholding their product until the government was forced to review the prices by 117 percent - a rise which the producers say is not sweet enough.

Zimbabwe is battling a scarcity of other basic commodities such as milk, cooking oil and the staple maize-meal.