The Central Statistical Office has disclosed that the recent fuel price hike in the country has triggered a 0.2 percentage points increase in the annual inflation rate for the month of February, which now stands at 9.8% from the January rate of 9.6 percent.
In January 2010, the Energy Regulation Board effected a 15% fuel increment which has triggered increments in prices of public bus fares and some food products.
Speaking this morning during the release of the February 2010 monthly publication, CSO deputy director Peter Mukuka says the increase of 0.2 percentage points in the inflation rate in February is attributed to the increase in the prices of fuel and some food products.
He explains that of the total 9.8% annual inflation in February, food products accounted for a 4.1 percentage points, while non-food products in the consumer Price Index collectively accoutered for a total of 5.7 percentage points.
Mr Mukuka says a comparison of retail prices between January 2010 and February 2010, shows that the national average price of a 25kg bag of roller meal increased by 0.8% from K49,554 to K49,934, while the average price of a 20 litre tin of maize grain increased by 4.6%, from K26,247 to K27,454.
He says the national average price of 1kg of tomatoes increased by 15.2 %, from K2,976 to K3,427, while the national average price of 1kg of pumpkin leaves reduced by 7.5 %. from K2,577 to K2, 383.
QFM
Where is MMD when all this misery is befalling our people? The hour has come. Kuya bebele
Prices of commodities such as copper and oil have recovered and continue to go up as the global recession has ended. Even here in the UK, inflation as gone up as fuel prices have gone up, and are still going up. The Bank of England expects inflation to keep going up for some time.
In Zambia one helpful thing is to manage the current maize harvest so we dont find ourselves importing like we did last year. Imported maize is more expensive, pushing up inflation.
But the all persive factor is fuel prices. May be the govt will try to keep prices down come 2011 elections. But beware impact on Indeni and Tazama. FTJ did that prior 2001 elections – result: Znoc got bankrupt.
Suggestion, bring back mines windfall gains tax – Let copper prices compensate oil prices.
The puzzle of managing an economy. The 9.6% inflation liggered in my mind when it was announced to whether it was true or not cos i believed then that it lacked mechanisms of sustaining it. As long as we continue depending on fossil fuels imported from Asia and the like, double digit inflation is here to stay. The solution also lies in our hands, agriculture for capital accumulation which always receive lip service. We better apply more effort to agriculture sector for this country to export more whose returns can be used to explore and develop our fossil energy deposites lying underneath us in most regions of Zambia. OPEC is yet to cut on production to further induce demand on their product fossil oil.
Volcanologist, why or why don’t African countries not invest in Agriculture and local human resource. I know you have heard about the energy producing blue cell. Our continent has all it needs to survive but the lies shed upon the masses for a few 100 years has veiled our glorious people, e.g Zipporah Moses’s wife was Ethiopian in short a sister but most of you watched the doctored movie the Ten commandments. I drifted off a little there but what am saying is this inflation is measure of the thirty or so percent of Zambians in employment plus the supporting industry and GDP projection. The others are not even summed up in this.
#3 Vocanologist. Spot on.
I also wonder how Zambia can sustain single digit inflation given existing structure of our economy and we are so vulnerable to oil prices. We need a fundamental shift in the basis of our economy, as you rightly pointed to agriculture and agro exports.
Cost of money is also very high in Zambia. Bank interest rates are just too high. All these feed into the cost of living and prices of goods and services in the country. Imagine, bank interest rates are above 20% despite inflation being less than 10%. How do banks justify that. Do we have bankers on this blog? Please educate us.
Redusing cost of money and cost of fuel energy will go a long way to reduce base inflation in Zambia.
*-:) No# 3 Volcanologist your points are great and educational I have learnt a lot more today. Hope we all learn everytime a blogger shares important eye opening information.
# 4 Mwana wakwitu
The Jesuits or such people used to measure inflation by a basket of foods. Do they still do that. I wonder what their figure would be.
KK via his socialist policies introduced Stae farms and many agro activities such as thru ZNS, the prisons, provincial cooperative unions etc. We even had banks such as Agric Finance Bank and Lima Bank. FTJ’s govt more or less did away with such things.
May be we should have just found a way of building on that infrastructure and run them more effectively. Our subsistence farmwers are just too poor to depend on for exports. We need more commercial farming with modern equipment.
Is there a study on Zambian agriculture somewhere e.g at UNZA or public libraries that we can read?
The increase in inflation was expected with the increase in the fuel price. What is needed is to sustain inflation to certain levels. I hope the BOZ adopts inflation targeting mechanisms of keeping inflation within certain levels and quickly acting should the inflation go outside the levels.