Zimbabwe freezes price hikes after launching currency reforms

CEAT Kelani Holdings Managing Director Ravi Dadlani (right) and Lanka Ashok Leyland CEO Umesh Gautham exchange the OEM agreement

HARARE, Aug 6, 2006 (AFP) – Zimbabwe has ordered a new freeze on prices of goods following a spate of increases on the heels of last week’s currency reforms to combat the effects of the country’s nearly 1,200 percent inflation, a state-run paper said Sunday. The country’s isolation from its traditional trading partners in Europe following the 2002 elections, which returned President Robert Mugabe to power and which western observers say were rigged, did not help. “No trader, manufacturer, wholesaler, dealer or retailer shall as a result of the conversion of the price of a commodity from the old currency to the new currency, increase the price of that commodity by any amount,” the Sunday Mail quoted Trade Minister Obert Mpofu as saying.

Many traders last week had upped prices after the central bank knocked off three zeroes from the local currency and introduced a new series of bank notes.

Commuter fares on some routes in Harare doubled from 100,000 Zimbabwe dollars (40 US cents) to 200,000 a day after Reserve Bank chief Gideon Gono announced the change in currency and a 21-day ultimatum to hand in old bank notes.

Gono had said the reforms were aimed at snuffing out a burgeoning parallel currency market and help shoppers who had to carry bags and ruc

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