• The retail sector provides up to  20,000 jobs, which plays a crucial role in supporting local economies and communities
• Economic Ripple Effects: The decline of the retail sector would lead to massive job losses, exacerbating unemployment and poverty, while negatively impacting related industries such as logistics and manufacturing
• Consumer Access and Economic Growth: A shrinking retail environment would reduce consumer choice and accessibility to goods, hindering economic growth and recovery efforts in an already challenged economy

Harare- The Confederation of Zimbabwe Retailers (CZR) has formally solicited the intervention of President Emmerson Mnangagwa to salvage the remaining components of the structured retail and wholesale sectors.

In a statement disseminated on January 26, 2024, the organization acknowledged the Ministry of Industry and Commerce's ongoing efforts, however, it emphasized that the challenges at hand are fundamentally fiscal and monetary in nature, necessitating presidential attention.

"CZR therefore calls for urgent intervention from His Excellency, President Dr.Emmerson Dambudzo Mnangagwa, to rescue what remains of theformalised retail and wholesale sector," Denford Mutashu President of the Confederation of Zimbabwe Retailers said.

Established in November 2013, CZR arose from a critical need for sector-wide representation, addressing a previously untenable situation for retail stakeholders. The organization has recognized the persistent support from the Ministry of Industry and Commerce but has highlighted that the root causes of current adversities are fiscal and monetary, requiring urgent and decisive actions to preserve formal business operations.

The retail sector stands as the largest employer in Zimbabwe after the government, providing employment for approximately 20,000 individuals. This significant workforce underscores the sector's vital role in the economy, not only in terms of job creation but also in sustaining livelihoods for countless families. The potential demise of this sector is concerning due to the far-reaching implications it could have on economic stability and social welfare.

A decline in retail operations would lead to massive job losses, exacerbating unemployment rates and increasing poverty levels. The contraction of the retail sector would negatively impact related industries, such as logistics and manufacturing, further entrenching economic challenges.

The recent closure of several outlets under the N. Richards Group, alongside the impending shutdown of others by January 31, 2024, reflects the escalating crisis.

This situation is further exacerbated by Spar Zimbabwe's difficult decision to terminate operations at Queensdale Spar, Choppies Zimbabwe's withdrawal from the market, and Mahommed Mussa's significant downsizing of retail space by 60%.

 As the representative body for these and other brands, CZR expresses alarm that formal businesses are contending with substantial challenges while authorities continue to present a misleading portrayal of the operational landscape.

The existing fiscal, monetary, regulatory, and statutory frameworks have proven to be inhospitable to formal retail and wholesale operators, creating a disparity that allows the informal sector to thrive with minimal regulatory intervention.

The increasing levels of informalisation have resulted in substantial market share losses for formal businesses, as the unregulated informal sector offers goods at significantly lower prices by circumventing statutory obligations such as taxation, licensing fees, and labour laws.

Consequently, this dynamic has rendered competitive operations for formal businesses increasingly untenable.

One of the most critical issues is the dual currency system, which disproportionately impacts formal retailers and wholesalers. These businesses are compelled to transact in the ZiG currency within a predominantly dollarized supply chain, leading to operational challenges.

Key expenses, such as fuel for generators, must be settled in USD, while sales remain largely in ZiG, with approximately 80% of transactions occurring in local currency.

Punitive banking fees, including the Intermediated Money Transfer Tax (IMTT), have incentivised cash transactions, further diverting consumer activity to the informal sector and leaving formal businesses struggling to maintain customer foot traffic.

Retailers and wholesalers face an excessive regulatory and compliance burden, with over 30 distinct licensing fees. This regulatory strain often surpasses the profit margins of these businesses, jeopardizing their viability.

In light of these challenges, CZR appeals to the Presidium to prioritize strategic interventions that aim to safeguard employment and alleviate the ongoing wave of shop closures and workforce reductions.

CZR has outlined several critical measures and urges the government to expedite initiatives aimed at formalizing the informal sector, thereby fostering equitable competition and ensuring tax compliance among all market participants.

The organization advocates for a reduction in the regulatory burden by streamlining and rationalizing current licensing and compliance requirements, which would significantly alleviate pressure on formal businesses.

Immediate support for formal retailers and wholesalers is imperative to cushion them against the overwhelming regulatory costs that currently threaten their sustainability.

 Equity Axis News