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Price of basics soars beyond reach of poor Zimbabweans
Sarudzayi Zindoga, Mail & Guardian (SA)
March 20, 2006

http://www.mg.co.za/articlePage.aspx?articleid=267195&area=/insight/insight__africa/

Grace Chidanyika (39) is a mother of three girls, two of whom are in school and very bright. One's dream is to become a lawyer, while the other hopes to be a banker. As the children talk about their dreams, their mother's eyes cloud with tears as she wonders how she is going to raise the money for their tuition fees.

Her youngest child is six years old and supposed to be at least in pre-school, which is too expensive -- the cheapest ones cost Z$2-million (about R122) a month -- so she will just go straight to grade one next year.

Her eldest has just finished her O-levels (schooling up to the age of about 16). She passed with flying colours and has to go for A-level in a few weeks' time. For her O-levels her mother paid Z$2,2-million (about R134). Now she has to buy new uniforms and pay double last year's fees. An alternative is for the girl to go to any of the teacher's colleges or polytechnics that are abundant around the country, but the fees are not less than Z$12-million (R736) per term.

Her husband is a schoolteacher at a school in Harare. He earns about Z$8-million (R490) per month, and from this salary the family has to buy groceries and pay bus fare, at Z$100 000 (R6) a day for him. The family rents two rooms in the city's high-density Mufakose suburb for Z$4-million, which might increase at any time.

Chidanyika says she feels bad about not being able to provide adequately for her children's food and education needs. "I try to supplement the family budget by selling foodstuff on the black market. However, my earnings are not much as we are continuously raided by the police who take our stuff if we don't bribe them."

She says it is a miracle that they have survived this long with such meagre funds. "Every day I pray to the good Lord to help us face this life with hope," she says resignedly.

Her family is just one example of the life of most Zimbabweans.

Prices of groceries, education, rentals, transport and other basic needs have been increasing weekly, if not daily. Salaries for most company employees and civil servants are only hiked up once a year, and whenever it does happen, inflation eats up all of it, leaving workers with empty hands.

The government's Central Statistics Office (CSO) recently announced that inflation hit a record high of 782% in February, with economic analysts saying it will most likely reach 1 000% in March. Those who thought 2006 might be a better year will have to start devising new tactics of survival.

Most families stopped buying meat, milk, bread and other basics a long time ago and now consider these luxuries. It seems these families now have no choice but to cut down again -- and most likely they will be left with nothing.

According to the CSO, the consumer price index increased by 27,5% in February, compared with 18,6% the previous month. The CSO attributes this to further hikes in transport, education and housing costs.

Moffat Nyoni, acting director of the CSO, said: "This means on average, a bundle of goods and services by households for final use in Zimbabwe was about eight times as expensive in February as it had been 12 months before."

The Consumer Council of Zimbabwe (CCZ) pegged the consumer basket for a low-income family of six at Z$28-million in February, an increase from Z$21,8-million in January.

Surveys for the CCZ consumer basket are conducted twice a month. The basket is calculated by averaging the prices of goods from retail outlets throughout the country.

The CCZ says its consumer basket accurately depicts the cost of living in Zimbabwe. Were it to be adopted as the official poverty line, the majority of Zimbabwe's people would be considered to be living in total poverty.

This economic burden borne by ordinary people is the worst of its kind in Zimbabwe's history, with a new slogan among locals having been adapted: "If you can survive Zimbabwe, you can survive anything in the world."

Economic analysts say the inflation crisis can be attributed to the money growth supply, which has remained too high. The country has seen macro-economic contraction of 30% since 1999.

Meanwhile, most companies are saying it would be unfair for the government to control prices, as the government's recommended prices are not realistic considering the cost of production.

A few weeks ago, the National Bakers' Association (NBA) was pushing the government for another increase in the bread price to Z$90 000 (about R5,50) -- barely a week after an increase to Z$65 000 from Z$45 000.

The association's chairperson, Burombo Mudumo, said that the increase was to keep abreast with inflation and enable companies to break even without making a profit. He said the association wished to avoid shutting down some bakeries, thereby adding to unemployment.

He went on to say that bread was the only product whose price had not been adjusted for the previous three months, and that bread consumption had gone down drastically, by 50%, due to its cost.

Despite last year's Reserve Bank plans to reduce inflation to a manageable level, it seem the reverse is happening.

According to analysts, fuel and food shortages have left two-thirds of the country's population unemployed and impoverished, with no hope for a better and brighter future.

This scenario comes at a time when the International Monetary Fund (IMF) has denied Zimbabwe voting and associated rights, as well as access to any more funds.

An IMF statement said: "We noted that Zimbabwe's crisis called for a comprehensive policy package, comprising several mutually reinforcing actions in the area of macro-economic stabilisation and structural reforms."

The government is now challenged to take steps to liberalise the exchange rate and deregulate prices in order to save the nation from starvation.

The Zimbabwean dollar has been free-falling since 2000, when it was trading at 1:24 to the United States dollar. It is now trading at 1:99 000 on the official market against the dollar.

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