In language that is turning increasingly and worryingly militant, the government has accused Tongaat Hulett of economic sabotage. Information, Publicity and Broadcasting Services Minister Monica Mutsvangwa had this to say about the company:
We are fully aware of acts of economic sabotage that are going on which however do not come as a surprise because some elements in the political arena openly declared that they would spoil the broth.
We are wondering what is really happening in the country that justifies a 100 percent increase in prices of basics within a week. It is clear sabotage. What is Tongaat Hulett importing in its production of sugar that justifies the current prices? What currency are they using in paying their workers that warrants these increases?
Tongaat Hulett, Zimbabwe’s largest sugar producer, announced price increases a week ago. There are not the only ones. Fuel prices were briefly increased to around $8 per litre before the government intervened. Cooking oil prices increased to almost $20 RTGS, so did Mazoe and mealie-meal.
While it is true that Tongaat does not import sugar they have to import certain raw materials that they use in its production. Even though it is still far behind the black market rate, there was a significant surge in the interbank rate.
Then there is also the issue of drought, Zimbabwe, like all Southern Africa suffered a drought during the 2018-19 season. This resulted in below normal yields for most crops. Basic economics means that shortages have to be resolved by price increases until a new equilibrium price is reached.
