Africa (Business)

Zim inflation hits 2,2-million percent

Staff Reporter

Zimbabwe's annual rate of inflation has hit a new record high of 2,2-million percent, central bank Governor Gideon Gono said on Wednesday.

The annual rate of inflation in Zimbabwe, already the highest in the world, has hit a new record level of 2,2-million percent, the central bank’s governor revealed on Wednesday.

“Statistics provided by the CSO [central statistical office] indicate that it is now at 2,2 [million percent],” Gideon Gono said in a brief address in Harare ahead of a speech by veteran President Robert Mugabe.

The figure is the first from the authorities in Zimbabwe since the announcement of the rate for February, when it was put at about 165 000 percent.

The head of the CSO, Moffat Nyoni, confirmed the figure but said it was only a rough barometer as it was based on limited data.

“We can confirm that that is the figure we have given to ... users, but that is not the sort of data we would normally publish with confidence because it was not based on the sort of information we would normally use,” he said.

“The information was based on fewer observations than we would be confident with due to scarcities. However, with the information we have managed to obtain, this is the rate of inflation.”

Mugabe, who was controversially re-elected for a sixth term in office last month in a ballot boycotted by the opposition, said that increasing levels of production was key to efforts to tame inflation.

“As a country our declared battle against the scourge of high inflation must be accomplished,” he said.

“The more goods we have, the less demand there will be ... Once demand is satisfied, then prices will begin to fall.”

The 84-year-old president, who has frequently blamed the country’s economic woes on a package of targeted sanctions imposed by the West, reiterated his attack on the “illegal” measures.

“We must be of one accord. The sanctions must be defeated,” he said.

Once one of Africa’s best-performing economies, Zimbabwe has been in meltdown since the turn of the decade when Mugabe embarked on a controversial land-reform programme that saw thousands of white-owned farms seized by the state.

Inflation first passed the 1 000% threshold in May 2006 and has been rising almost continuously ever since.

The government has tried a series of measures designed to slow down the inflation juggernaut, including ordering shops and businesses to effectively halve the price of basic goods last year.

The plan was abandoned after it led to widespread shortages in shops.

Retailers now have to increase their prices several times a day for goods purchased with billion-dollar bank notes.

With salaries lagging ever further behind the cost of living, many Zimbabweans now make do with only a meal a day and have long given up on so-called luxuries such as jam.

Even staples such as bread and cornmeal are now hard to come by, costing several weeks’ wages.

Urban areas have been hardest hit with rural areas managing to overcome the worst affects of what Gono has called Zimbabwe’s “economic HIV” by growing their own produce.—AFP

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