Minister Urges Businesses to Cut Prices as Economy Improves

Trade and Industry Minister Chipoka Mulenga expressed frustration that businesses were quick to raise prices during economic downturns but slow to reduce them when conditions improved.

"Whenever fuel is increased by K1 or K2 today, overnight prices of goods go up," Mr Mulenga told market players at a meeting in Lusaka. "But in the past three months... we have not seen any reduction in commodities."

The minister highlighted that inflation had dropped from 16.5% to 15.5%, while the Zambian kwacha had strengthened by 17% against major currencies over the past quarter.

There has been a mixed response from retailers. Shoprite said it had been negotiating with suppliers and expected price reductions within a month.

"We have been engaging our suppliers for some time now to talk about the factors that have come down," said General Manager Charles Botha. "When the cycle takes effect... we should begin to see the prices that people are thinking about coming down."

However, progress has been uneven across the country. While mealie meal prices on the Copperbelt have dropped from K400 to K250 following a good harvest, prices in Lusaka have remained static.

Mr Mulenga attributed the kwacha's strength to increased domestic production, particularly in copper mining and fertiliser manufacturing.

"The copper mines are now beating to life, the fertiliser which we used to import, we are now exporting it," he said, adding that the nation aims to become a major exporter of electric cables by 2031.

The Zambia Association of Manufacturers agreed to encourage members to pass cost benefits to consumers, while the Chamber of Commerce called for businesses to respond to the economic improvements.

Lower commodity prices would provide relief to the population. The economic improvements are also creating employment opportunities, with new copper processing plants and increased manufacturing activity generating jobs across the country.