Some manufacturers and suppliers indeed exploiting consumers using kwacha devaluation as scapegoat—CFTC

While it is obvious that any devaluation of the currency may trigger an upward adjustment of the pricing of goods or services, Competition and Fair Trading Commission (CFTC) has observed that indeed some traders are using the devaluation as a scapegoat to exploit consumers.

CFTC and the Ministry of Trade & Industry were mandated by President Lazarus Chakwera to intensify investigations of any perceived unjustified price increases and to apply appropriate penalties to offenders in order to protect the citizenry against the current skyrocketing prices of goods and services.

Thus the CFTC has observed that some price this far “depict a trend of possible opportunism through excessive price increases” using the devaluation of the kwacha effected on November 7 by the Reserve Bank of Malawi.

In a public notice issued by Executive Director, Lloyds Vincent Nkhoma, says CFTC has been conducting price monitoring exercises in the major cities and towns of the country to gather evidence of the violation of the Competition and Fair Trading Act (CFTA).

“In this regard, the CFTC has so far formally approached 19 manufacturers and suppliers of products and services to explain the rationale behind such high price adjustments.

“CFTC has also engaged the relevant regulators on the same. This is the normal first step in the due process that the CFTC always follows before commencing a full investigation where the evidence points to a possible violation.

“The CFTC, in collaboration with the Ministry of Trade & Industry as well as Ministry of Local Government, Civic Education & Culture, is now expanding this price monitoring exercise to the districts and rural trading centres of the country to establish and gather evidence of possible violations of the CFTA.

“The general public and the business community is hereby informed that should any supplier of goods and services be found to be engaging in excessive pricing contrary to the CFTA, the CFTC will not hesitate to issue relevant penalties and sanctions for such conduct as provided for under the law.”

The Executive Director further encourages consumers and the general public to report any suspected violation of the CFTA through its toll free line 2489 or send a WhatsApp message to 0987738749.

When announcing the directive from the President, Secretary for Trade & Industry, Christina Zakeyu said following the announcement of the devaluation some manufacturers, traders and suppliers took advantage of the situation by unreasonably raising prices of their goods and services.

Images of notification by some traders entrances were awash on social media that indicated the temporary closure of their businesses in order to adjust prices for old stocks that were already in shelves and warehouses before devaluation.

Thus Zakeyu warned that selling goods and prices at excessive and unreasonable prices is a gross violation of the CFTA and that traders found engaging in such malpractices shall be dealt with.

When announcing his efforts to alleviate the economic strain caused by the devaluation by 44%, President Chakwera issued a directive to halt any increase in water tariffs by the country’s water boards.

Chakwera firmly stated that any losses incurred should be covered through the water boards’ operational accounts, sparing the citizens from bearing the brunt of additional financial pressure.

In addition to the water tariff freeze, President Chakwera has implemented several other measures to alleviate the impact of the economic downturn.

He has imposed a five-month freeze on all international trips for himself, Cabinet Ministers, senior government officials, and the heads of parastatals — a decision that aims to reduce unnecessary expenditure and redirect funds to more pressing national priorities.

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