After signing a Memorandum of Understanding (MoU) meant to kick start talks last month, President Robert Mugabe’s ZANU PF party engaged in dialogue with the opposition Movement for Democratic Change (MDC) in the hope of striking a power sharing deal.
MDC president Morgan Tsvangirai, who was tipped to become a ceremonial Prime Minister, refused to sign the document saying his powers were limited and Mugabe would take advantage of that and fail to honour some of his promises.
As a result, the inter-party dialogue being mediated by South African president Thabo Mbeki has been stalled amid fears they will never bear fruit. But Mbeki, who has been flying to Harare regularly, is reportedly keen to see Tsvangirai endorsing the power brokering talks.
But the aborted talks-which have brought almost everything to a temporary standstill due to a serious policy paralysis-have resulted in a sharp increase in the prices of most goods and services.
From clothing, pharmaceuticals, transport, rents and food, the prices shot up by more than 100 percent.
A suit which was going for ZW$20 000 (revalued), shot up to ZW$54 000, while a small bottle of Vaseline now costs ZW$2 000. A two-litre bottle of cooking oil shot up to ZW$4 000.
Residential and office rentals that were being charged in foreign currency, with a room going for South African Rand 100, are now pegged at R180.
Economic analysts said the recent rise in inflation has been triggered by the outcome of the talks as the businesses were taking a wait-and-see approach.
“Everyone was pinning hopes on the success of the talks. But as the talks hang in the balance, producers have panicked and increased the prices of goods and services,” said an economist.
He said Zimbabweans should brace for worse days to come owing to the rate at which salaries were being eclipsed by inflation.
Radio VOP