‘Dollarisation of prices illegal’
Published On November 27, 2015 » 2808 Views» By Davies M.M Chanda » HOME SLIDE SHOW, SHOWCASE
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. Mwanakatwe

. Mwanakatwe

By JAMES MUYANWA and ANTHONY MULOWA –
PRESIDENT Edgar Lungu has said the dollarisation of prices is illegal and unjustifiable, hence it should be stopped with immediate effect.
Mr Lungu has also called on the Ministry of Finance and Bank of Zambia (BoZ) to back this ban with the law as the practice has been contributing to the artificial rise in inflation.
The President urged the business community to stop charging and quoting prices in dollars as this was illegal and immoral.
Mr Lungu, therefore, directed the BoZ and the Ministry of Finance to curb the vice by coming up with stiff laws to back up the existing ones.
He said during the Press conference that there was stability in the foreign exchange rate and, therefore, quoting prices of goods and services as well as charging in the United States (US) dollar was unwarranted.
“It is not just illegal, but immoral too, that the unscrupulous businesses who price in dollars maintain the same pricing of a higher rate even when the Kwacha has appreciated.
“The measures undertaken by the BoZ in consultation with the Ministry of Finance have so far yielded positive results in stabilising the exchange rate. All things being equal the future outlook is a stabilised rate inclined towards further appreciation,” he said.
Mr Lungu said that the relative stability of the Kwacha could be attributed to a combination of measures which had been put in place.
These include the BoZ’s tightening of the monetary policy, foreign exchange support, monitoring of foreign exchange market and information flow in the market.
The Kwacha is, however, up against the falling prices of copper which were, as at Wednesday this week below $4,600 per tonne and the strengthening value of the dollar.
“Over the past two weeks, the Kwacha has regained some of its lost value and has exhibited some relative stability. As at close of business on November 25, the Kwacha was trading at K11.50 per US dollar (in terms of the mid-average rate), representing a month-to-date appreciation of 6.9 per cent,” he said.
On investor confidence, President Lungu said that the country had faced challenges in the perception that investors could lose their property to the State.
This mainly followed the take-over of the Kasumbalesa border facility by late President Michael Sata’s administration in 2012.
“I am happy to learn that some regional and international financial institutions that avoided investing in the country are assured following the amicable settlement of this matter. The Development Bank of Southern Africa (DBSA) will now release a US$70 million facility to continue supporting the road programme,” he said.
In addition, he said, $200 million would be extended to Zesco by DBSA for various electricity projects.
“Zambia shall, therefore, regain access to the most needed international foreign currency,” he said.
Meanwhile, Mr Lungu said the Government would put up measures that would promote Zambian products on the local market.
He said very soon Commerce Minister Margaret Mwanakatwe would lunch the ‘Proudly Zambian’ campaign, which would promote the utilisation and selling of local products.
The Head of State said the trend of over-importing commodities which could even be produced locally was negatively affecting the economy.
Mr Lungu noted that there was no way bananas or potatoes could be imported from outside when Zambians had potential to grow the fruits.
He, however, urged Zambians to ensure that the products they produced or cultivated were of good quality.
“Zambians should up their game. Potatoes and bananas can be grown locally,” he said.

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