Zimbabwe’s annual inflation reached 585,8% in December, closing in on the record high levels reached in 2004, the government statistical agency said on Tuesday.
The latest figures mark an increase of 83,4 percentage points from December 2004 and fly in the face of Zimbabwe Reserve Bank Governor Gideon Gono’s projections of inflation levels reaching between 280% and 300% by December 2005.
The year-on-year inflation rate has been climbing monthly since March.
”The consumer price index increased by an average of 585,8% between December 2004 and December 2005,” the Central Statistical Office said in its monthly report.
Economist Best Doroh, of banking group Zimbabwe Financial Holdings, expects inflation to continue creeping up until May.
”Between now and May, the probability of inflation continuously going up is high,” Doroh said. ”This is largely because the country will continue importing food. Zimbabwe will only know of its total grain produce probably in May, so this uncertainty will add on to inflationary pressures.”
Inflation in Zimbabwe reached its peak in January 2004, hitting 624%.
Zimbabwe’s economy has taken a steep dive since the late 1990s, shrinking by 30% over the past six years.
Over four million Zimbabweans in a population of 11,6-million face food shortages, according to United Nations agencies.
The government blames the economic drop on drought and targeted sanctions imposed by the European Union and the United States on President Robert Mugabe, members of his inner circle and their families following the disputed presidential election in 2002.
Critics say the seizure of white-owned farms since 2000 has led to the collapse of agriculture, which was the backbone of the economy. — Sapa-AFP