|
Back to Index
This article participates on the following special index pages:
2008 harmonised elections - Index of articles
Prices
rocket as dollar tumbles
Paul Nyakazeya, The Zimbabwe Independent
March 20, 2008
View story on
the Zimbabwe Independent website
Prices of basic
commodities this week surged on the back of Zimbabwe's galloping
inflation and the dollar's further crash on the black market.
Although the
inflation figures for February have not yet been officially released
a number of companies are estimating it to be more than 160 000%.
The Zimbabwean dollar has been on a major slide against major currencies
over the past two months. This has pushed the price of fuel, the
key cost in production, to $50 million a litre. With the parallel
market now being the major source of foreign currency, it means
companies have to adjust their prices according to the black market
rate in order to remain viable.
Manufacturers this week reviewed their prices by between 200 and
260%. Company executives who spoke to businessdigest said further
reviews were possible this week as the Zimbabwean dollar continues
its plunge. A survey conducted this week showed that most shops
increased prices by more than 240% in the past two weeks. A two
litre bottle of cooking oil now costs about $220 million from $70
million at the beginning of the month. A 2kg packet of rice now
costs about $80 million, up from between $38 and $40 last week.
A bar of washing soap is going for $45 million from $22 million
while a two litre bottle of Mazoe Orange Crush costs more than $55
million, up from $25 million. Carbonated drinks now cost $10 million
from $4,6 million. Delta this week increased the price of beer from
$8 million a pint to $20 billion.
Analysts have attributed the massive rise of basic commodities to
the fall of the dollar against major currencies. "The weakening
of the Zimbabwe dollar against major currencies has been a reflection
of the rise of real prices of commodities relative to prices of
the same goods in US dollars," economic consultant John Robertson
said this week. The parallel exchange rate of US$1 was $1 900 000
at the beginning of the year. This rate was $40 million on Wednesday
this week. "The impact is being felt by the ordinary man in
the street as goods and services are being priced using parallel
market rates at a time when disposable incomes are not being adjusted
in line with parallel market rates," said Zimbabwe Allied Banking
Group economist David Mupamhadzi. The price of bread is now $10
million a loaf from $4,5 million. However, bakers are already pushing
for an increase in the price of bread to between $10 million and
$15 million a loaf.
Please credit www.kubatana.net if you make use of material from this website.
This work is licensed under a Creative Commons License unless stated otherwise.
TOP
|
