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Prices Surge Higher as Zimbabweans Anticipate Wage-Price Freeze

Prices of food, fuel and other commodities in Zimbabwe jumped again Wednesday as producers and wholesalers moved preemptively in anticipation of a four-month price and wage freeze to be imposed by the Reserve Bank of Zimbabwe.

Parallel market fuel prices almost doubled to Z$9,000 (US$1.20) a liter from Z$5,000.

Reserve Bank Governor Gideon Gono announced plans for a price freeze during his quarterly monetary policy review in early February, saying the country needed a social compact fixing wages and prices to arrest the nonstop upward spiral in prices.

But there has been little progress towards such a social contract. The government set up a committee to advance the idea, but that panel has issued no proposals.

The country's Tripartite Negotiating Forum involving business, labor and government has yet to start hammering out such a contract, because the Zimbabwe Congress of Trade Unions wants to see economic and political reforms by the government first.

ZCTU Secretary General Wellington Chibebe said in addition that he considered it unfortunate that Gono announced a wage-price freeze without consultations.

Harare economist James Jowa told reporter Jonga Kandemiiri of VOA's Studio 7 for Zimbabwe that the country's consumers must now bear the brunt of the consequences of delay as the latest price increases are not likely to be reversed.

More reports from VOA's Studio 7 for Zimbabwe...