FAMILIES in Zimbabwe have to spend almost $500 billion extra every week on food and transport because of high inflation and depressed production.
The increases in the price of basket essentials is surging by an average of 55% every week according to the businessdigest Cost of Living Index.
The weekly rate of increase has jumped alarmingly from 9,5% in January to 55% during the first week of July, a 45,5 percentage point rise inside six months.
There is now a countrywide crisis over supplies of basic commodities and affordability of the few that are available in shops.
A family of five which spent $400 billion a week on
food last week now needs $627 billion for the same products this week. The same family will need about $960 billion next week.
Two litres of cooking oil cost above $300 billion this week from $245 billion last week. A loaf of bread – if available – costs $45 billion from $30 billion last week. Two litres of Mazoe, which is no longer affordable for most households, this week cost above $130 billion from $90 billion last
The Consumers Council of Zimbabwe said it was no longer publishing the monthly consumer basket as it did not make sense to come up with one at the rate prices were rising.
Government’s Central Statistical Office has also stopped compiling poverty datum line figures in what critics said was an attempt to hide “an open secret”.
Most consumers are performing what appears to be carefully choreographed dance routine: pick up, sigh, put down and move out of the shop.
With banks restricting withdrawals for individual to $100 billion a day, shopping has become something Zimbabweans dread as prices continue to rise.
Figures from Caltex show that the cost of fuel had risen by from $35 billion a litre last week to $60 billion.
Motorists are a victim of international oil speculators and a weak currency.
The higher fuel prices are dragging up the cost of basic commodities and services.
The rise in the prices of most basic commodities has been blamed largely on speculative tendencies in the country’s frail economy now in its ninth year of recession.
But economists said the dwindling production levels on the back of increased money supply growth and a weak currency has resulted in too much money chasing too few goods, and this has been worsen by acute foreign currency shortages which have triggered a run on the Zimbabwe dollar.
Business lost confidence and trust in government following its decision to direct retailers to reduce the price of goods by 50% last year.
By Paul Nyakazeya