Illegal vendors menace: Smuggled basic commodities flood Bulawayo

TENDAI BHEBE IN BULAWAYO

 

An investigation by  BusinessTimes ,supported by the Voluntary Media Council of Zimbabwe (VMCZ) has exposed how some basic commodities are smuggled from South Africa into Zimbabwe, and specifically into the city of Bulawayo, exposing how the smugglers circumvent authorities  at Beitbridge  Border Post.

Bulawayo has been transformed into a city of mini-shops by the vendors, where smuggled goods from neighbouring South Africa, are openly sold by unlicensed vendors to a populace with a strong appetite.

In the Central Business District , the products are primarily sold along Five Avenue between Robert Mugabe, Jason Moyo, and Joshua Mqabuko Nkomo streets.

The investigation revealed a cunning network of smugglers operating in collusion with bus companies traveling the Bulawayo-South Africa route as well as cross-border transporters, also known as omalayitsha.

To understand more about how they function, BusinessTimes spoke with a few of the couriers and recipients of the goods.

The smugglers use a variety of social media sites, including Facebook and WhatsApp, to find customers and plan their operations.

Mr. Smart Shopper, Nyasha Wholesale BYO 005, and First Class Groceries are a few of the social media pages.

After feigning interest in joining the trading syndicate, this reporter pretended to be interested in joining one of the WhatsApp groups, First Class Groceries.

The group has four different WhatsApp groups and a Facebook page.

Only group administrators are allowed to share information within the group.

Any member can contact any administrator directly through their inboxes if they have a question or want to buy something for themselves or to sell.

In order to make money for themselves and their members, the administrators have also launched money-making initiatives.

“A good afternoon to you all. Welcome to all that have joined us. It’s our privilege and honour to serve you. For all who want to register for the stokvel, please kindly send your name to any administrator, then that will be considered as registered. Deadline for registering is the 25th August. Then your administrator as per your choice will take you through the process. Thank you so much and a good afternoon,” wrote one group administrator on 20 August.

One of the group members explained what a stokvel is.

“A stokvel is a money generating party like where we sell beer and food such as meat. That is where we come as a group and make monthly contributions towards groceries and some  money that can be shared towards end year,” said Nomusa Dube, a member of the group from Entumbane suburb in Bulawayo.

To combat escalating and unjustified price increases of locally produced goods, the Zimbabwean government suspended import duties on basic commodities under Statutory 80 of 2023 in May of this year.

However, the Zimbabwe Revenue Authority (ZIMRA) pointed out that the duty-free allowance is set at US$200 on goods intended for personal use, such as alcoholic beverages, where individuals are not permitted to pass with more than five litres, of which no more than two  litres may be spirits.

The goods are not for resale or of a commercial nature.

However, goods being brought in the country by informal traders are pegged way beyond the US$200 mark.

Government made the move to curb what is said were unjustified increases in the prices of goods and services during that time. Most shops were pegging their prices on black market rates at a time the local currency was fast losing its value compared to the US dollar.

The parallel market activities had fuelled the depreciation of the local currency and inflationary pressures.

To cushion consumers, rice, flour, cooking oil, margarine, salt, sugar, maize meal, milk powder, infant milk formula, Tea (whether or not flavoured), petroleum jelly, tooth paste, bath soap, laundry bar, and washing powder were declared to be duty free.

Import duty and import VAT was suspended on 10 basic goods; maize meal, rice, milk, flour, salt, cooking oil, petroleum jelly, toothpaste, bath soap and washing powder. The suspension of the import duty and import VAT was valid for six months.

A cross border trader Lelethi Gumbo who resides in the sprawling suburb of Nkulumane and has smuggled goods on numerous occasions with the help of omalayitsha revealed that corrupt persons manning the Beitbridge Border Post facilitates smuggling.

“Normally we order our products in Crownmines, Johannesburg at cheaper prices. The cross border traders have different  traveling days but the one I use normally leaves Johannesburg on Friday around 2pm.The omalayitshas are usually found in Hillbrow where they receive goods from their customers,” revealed Gumbo.

“Mostly I leave my products with umalayitsha then go board a bus as it will be cheaper to take that route. We pay the malayitsha 300 rand or more depending on the quantities of the goods. The malayitsha  usually arrives in Bulawayo at around 10am the following day having travelled the whole night. Before making the deliveries he checks if what he was transporting is still intact. He then makes door to door deliveries.

Bus drivers operate in a similar manner to other businesses in dealing with their clients.

“I sell basic commodities like cooking oil, rice, sugar and mealie meal. My pricing depends on the money I spent to purchase them and travelling costs so that I make profits. People used to travel to South Africa to buy but now a few are traveling to avoid incurring costs. South African goods which a lot of people from this part of the country love are now readily available, so many people are choosing to buy locally rather than to travel.”

When the goods are finally funnelled to the market their prices are cheaper compared to those charged by conventional shops.

Some of the goods would have been stolen before being smuggled into the country and they are sold at cheaper prices.

A malayitsha Muziwakhe Dube  weighed in saying :“This is our way of survival as our families back home are struggling. In South Africa there are taxi owners who have formed an  association and these people have drivers who transport goods to Zimbabwe. It’s a well organised syndicate of people and when we get to the border we call our agents there. We give them our papers so that they process for us at the customs offices. We are not searched as we just give them money for their services. Usually they are given US $ 100 and above depending on the load that one will be carrying. I cannot tell you more details on how we operate because you might get us into trouble. Some goods would be stolen in South Africa but we don’t have a say, we only transport goods from our clients that’s the relationship we have with each other.”

On the informal market a two- litre cooking oil is selling for US$3, while a 2kg packet of rice is pegged between US $1.50 and US$2. A 10kg packet of mealie-meal is going for around US$4 while  a 2kg packet of sugar sells for US$2.50.

The prices are cheaper than conventional costs, given that the traders have no extra costs such as rent, salaries for workers and overheads such as water and electricity bills.

At Greens Supermarket a two-litre bottle of cooking oil was $3.28 and a 2kg of rice was between US $1.99 and  $2.17, a 10kg packet of mealie meal at US $3.99 or $4.60 while a 2kg of sugar was US$2.65.

At Pick N Pay Supermarket a two-litre cooking oil was on US$3.30,  a 2kg rice for US$ 4,24 while a 10kg packet of mealie meal was on US$4,4. Sugar was not available.

From a consumer perspective, goods from the informal market have given them a reprieve from the biting prices being witnessed in the country.

“Nowadays it is better to buy from what we call cash shops because they are cheaper than buying from the supermarkets. Besides the ‘affordable’ prices also I have an appetite for foreign products especially those from South Africa,” said one consumer, Shumirai Dube.

Through smuggling the country is being prejudiced a lot in potential revenue in terms of taxes.

Also from a health point of view some of the goods found in the informal sector could have outlived their shelf life.

In an interview, Matabeleland Zimbabwe National Chamber of Commerce (ZNCC) chairperson McKenzie Dongo said smuggling was affecting social systems across the country.

“Smuggling is a serious cancer that affects not only business but the entire social systems. Smuggled goods tend to compete with properly procured stocks as they are cheaper and in some cases of inferior quality which may tend to pose health hazards.  They may not have been properly tested for conformity and at times are not properly transported that may require cold chain transportation but may just be transported in unsuitable way thereby posing serious health hazards to end users,” he said.

He added: “Smuggling also bleeds the fiscus of the much needed taxes in the form of import duty and VAT because in most cases these smugglers don’t pay duty and income taxes and pose serious threats to complying business.”

The basic commodities that are being smuggled into the country include flour ,mealie meal tinned foods such as fish, beans, beef, soap, sugar, cooking oil, cereals, rice and snacks which are popular with children.

Illegal vendors are now a menace on the city’s streets as they are causing congestion.

Informal traders constitute a huge chunk of the country’s workforce with many receiving significant gains from buying and selling variety of goods.

Confederation of Zimbabwe Industries (CZI) president Kurai Matsheza said  production output from companies had not come down.

“Whilst as industry we’re engaged with authorities on that issue, the production output from companies has not come down particularly on the back of strengthening our currency. As industry body we continue lobbying for duties on those basic commodities,” he said.

Buy Zimbabwe General Manager Alois Burutsa said there was an influx of fake products in the market that are sold openly.

“This has greatly affected the promotion of the local products market because they don’t pay duties and the products are made cheaper than the local products.

“We have seen again a huge influx of fake products  ‘cheap’ products in the market and this has affected the manufacturing industry as they are the ones producing the products,” said Burutsa.

In 2021, police in Bulawayo intercepted a 34-tonne truck that was smuggling groceries worth millions of dollars.

The South Africa number platted 34-tonne truck owned by CTME Logistics, was intercepted at the 28KM peg along the Bulawayo Beitbridge highway.

The truck, which was delivered to Bulawayo Ross Camp, contained boxes of hair products, dishwasher detergent, cans of beef, stock sweets, candles, lotion, and lotion.

 

 

 

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