The weakening of the kwacha against major currencies is pushing up prices of imported goods and may hurt some businesses, cross-border traders have warned.

The local unit has been weakening over the past few days but traded at K6.50 to a dollar by mid-morning yesterday after the Bank of Zambia’s intervention.

On Wednesday, the currency of Africa’s second copper producer hit K6.66 per dollar mark, its worst start to a year in more than six years.

The local currency’s poor performance has left several people counting the cost in lost business while a few are enjoying rich pickings.

Business owners who import goods from South Africa, retailers and cross-border traders are some of those that have been left hurt as the kwacha takes a beating.

Illegal currency dealers on the other hand have experienced a boom in their trade, as most people are exchanging the dollar for the kwacha.

In an interview on Thursday, cross-border traders who bring small orders, mostly clothing and alcoholic beverages, complained that since the kwacha came under pressure last year, businesses had drastically declined, forcing them to cut down on the number of trips out of the country.

COMESA/SADC Traders Trust chairperson Donald Kachingwe said at above K6.50 per dollar, the rate was still high and more government intervention to prop up the kwacha was needed.

“The kwacha should be propped up to the K4.80 to dollar level to make sense for our businesses,” Kachingwe said.

Individual traders explained that the weakening of the kwacha meant less buying power across the borders.

“My profit margins have seriously dropped. I used to make a K15 profit on each chitenge material I sold when the kwacha was trading below K6 to a dollar, but now I only make K5,” Nancy Zulu, who trades on Lusaka’s Chachacha Road, said.

Zulu, who has been trading for over four years, said a weak kwacha is a threat to the survival of her business.

“It is always a dilemma between increasing the prices and risking no one buying, but the only way out is to sacrifice a bit of profit,” said Zulu, who orders her goods from DR Congo, Tanzania and South Africa.

Beauty Mathonsi, another cross-border trader who operates from Lusaka’s COMESA market, a popular place for commodities from the COMESA region, said the fall in the kwacha has been “a curse” on her business.

“I buy clothes for resale from China, South Africa and Tanzania. The fall of the kwacha has not been a blessing as I have less money to order my stock outside Zambia using the dollar,” Mathonsi said, adding, “The choice I have here is to increase my goods.”

With the kwacha suffering a heavy battering most of last year, Zambia is still experiencing inflationary pressures as nearly 60 percent of goods in the shops are imported.

“The risk of this pressure on the kwacha is that it is likely to fuel illegal imports of goods,” said Joe Mbiya, a small-medium-enterprise business owner based in Lusaka.

“This is because we do not have serious manufacturing firms and in addition, the locally manufactured goods are too expensive to offset any price difference from imported goods.”