Burundi has announced plans to tame black market through allowing importation of sugar and cement. The Cabinet revealed the report and said the moves sets to meet a shortfall that has created a black market where prices have shot up.
“There are discrepancies between the reference prices and the actual prices on the market,” the Cabinet said, adding that efforts to enforce official prices have been in vain.
State-owned producers have also been seeking a price review, particularly beer maker Brarudi and cement manufacturer Buceco since 2021, for reasons including soaring raw materials and transport costs.
“Given the production capacities of these companies, it is not clear that these products will be available even after the price increase,” the Cabinet noted.
Financial capacity
The government noted that State-run Sosumo’s sugar and Buceco’s cement were insufficient and approved “other operators with sufficient financial capacity a gateway to import these products.”
The government said it would also accelerate the revamp of the sugar miller Sosumo to increase its production capacity.
Beer maker Brarudi proposed increasing prices per bottle between 200 Burundian francs ($0.098) to Bf600 ($0.29) based on product type. On its part, Buceco wanted to raise the price of a bag of its Cement 32.5R by Bf3,000 ($1.47). The official cement price is Bf24,500 ($11.99) but retails at Bf32,000 ($15.66) on the black market. However, the government says the two companies must first show how they plan to increase production to meet current demand.
The Trade, Community Development and Agriculture ministers were also tasked with creating modalities to help Brarudi on its quest to cultivate sorghum. The Cabinet also directed the enforcement of official prices since there is no corresponding tax increase when the commodity costs rise. In addition to the biting sugar and cement shortage, Burundi has also witnessed a shortfall of fuel, with long queues still seen in the commercial hub Bujumbura.
