Zimbabwe: Maize Meal Prices Set to Go Down As Govt Restores Grain Subsidy

5 December 2019

Mealie meal prices are set to come down after government Thursday announced new subsidy on maize meal in what will see the retail price of a 10kg packet of roller meal pegged at $50.

This was announced in a statement by Finance Minister Mthuli Ncube Thursday morning.

In his statement, Ncube said government was going to fund procurement of grain at market prices and sell the same to registered maize millers to ensure availability and affordability of the staple.

"This model will create fiscal space for treasury to finance other social protection programmes," he said.

"Government will ensure that the requisite monthly tonnage of 40 000 MT required for producing 32 000 MT of roller meal will be timely availed by GMB to members of the Grain Millers Association of Zimbabwe (GMAZ).

"In this regard, the new subsidy model will therefore target the production of roller meal resulting in the retail price of ZWL$50 for a 10 kg bag."

He added, "The payment modalities for the new targeted subsidy for roller meal has been discussed and agreed with GMAZ, whose members have a 95% share of the roller meal market."

Presenting his 2020 national budget last month, Ncube scrapped subsidies on maize and wheat saying they were a cost to the government.

The decision triggered a surge in prices of mealie meal with a 10kg bag of the staple shooting to between ZWL80 and ZWL100.

Ncube said in his budget statement last month that government subsidies of grain were "open to abuse and placed a huge burden on the fiscus", adding that intended beneficiaries of the policy sometimes did not enjoy the benefits.

But addressing Zanu PF youths in Gweru last week, President Emmerson Mnangagwa announced his government was reversing the ban on subsidies to protect impoverished citizens from rising food prices.

"We cannot remove the subsidy," he said. "So, I am restoring it so that the price of mealie-meal is also reduced (next year)."

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