HARARE – Finance Minister Mthuli Ncube on Tuesday raised the price of subsidised maize meal from $50 to $70, saying the measure was aimed at closing “undesirable arbitrage opportunities” in the market.
The government is subsidising maize meal through an arrangement with millers, but the fixed price maize meal has been in short supply in supermarkets, the government says because of unscrupulous millers who are exporting it or supplying unregistered traders who sell at a higher price.
Ncube said the government was reviewing how the subsidy works, and would soon announce new measures which ensure that vulnerable groups – the original target of the subsidy – can access the cheaper maize meal.
“The wide gap between the market and the subsidised price has created undesirable arbitrage opportunities for unscrupulous players, resulting in the market and supply distortions,” Ncube said in a statement.
“The government will announce a strengthened targeting system in due course, such that deserving vulnerable citizens as intended by the subsidy policy benefit.”
Millers this week complained that the price set by the government was too low.
“We have stocks which we have milled from imported maize but with the current price, we cannot sell,” Grain Millers Association of Zimbabwe chairman Tafadzwa Musarara said before the price adjustment was announced.
