18 January 2013

Zambia: Traders Warned Over New Kwacha

GOVERNMENT has warned traders countrywide against frustrasting its efforts in implementating the Kwacha rebasing exercise, saying this will trigger price increases and inflation.

Director of domestic trade in the Ministry of Commerce, Trade and Industry, Albert Muchanga said yesterday that the Government did not want any instability in the economy, the reason it was urging traders to uphold consumer confidence.

Mr Muchanga said the Government wanted to ensure that there was stability of prices to avoid inflation during the transition period.

He noted that some traders were adjusting the prices of goods and services upwards when rounding off the figures, leading to price increments.

The Government, he said, was determined to ensure that the transition period for the implementation of the Kwacha rebasing exercise was not mishandled by both traders and consumers to avoid inflation or erosion of consumer confidence.

The director, who toured some selected shops in Ndola yesterday, said the Government was concerned with reports that some consumers were dumping coins at some points of sale or simply keeping them at home.

"As Government we have received reports about some activities such as refusal to accept change in form of coins and rounding off prices upwards when using the rebased currency.

"All these activities will lead to unnecessary price increments which will also lead to inflation and negatively affect the country's economic growth," he said.

Mr Muchanga, who was on a fact-finding and sensitisation mission, said the Government wanted to ensure that traders did not use the rebasing exercise as an excuse to increase prices.

He said the Government was watching the situation and that traders should not invite inflation unnecessarily by being involved in dubious activities in their quest to reap from the Kwacha rebasing exercise.

"As Government we have put in place measures aimed at seeing to it that only the cost of production is used as the basis for price increments and not the rebasing exercise as the case is by some unscrupulous traders in different parts of the country," he said.

And Copperbelt Province Deputy Permanent Secretary, Georgina Kasapatu said the provincial administration was working in collaboration with various Government departments and stakeholders in implementing the enhanced Kwacha rebasing sensitisation programme.

She said traders should know that both the new and old Kwacha were still legal tender and that no-one should reject the old currency on the pretext that it was of no value.

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