/ 2 May 2008

Steep food prices push Kenya inflation to nearly 27%

Kenya’s inflation rate rose to 26,6% in April, up almost 5% from the previous month, the government announced on Friday, blaming rising food and oil prices.

“Month-to-month overall inflation rate increased from 21,8% in March 2008 to 26,7% in April 2008,” said a statement from the government’s Central Bureau of Statistics.

The bureau, which tracks Kenya’s consumer price index by monitoring prices at shops in 13 towns and cities around the country, found that the cost of food and non-alcoholic drinks had increased by 4%.

Oil prices climbed by 0,8%.

Violence erupted in Kenya after December 27 elections, when President Mwai Kibaki was declared the winner of a bitterly contested election amid allegations of vote-rigging by then-opposition leader Raila Odinga.

Attacks, fuelled by tribal and political rivalry, left at least 1 500 people dead and forced hundreds of thousands to flee their homes.

As a result, food prices climbed as many farmers and traders abandoned their work and fled.

In addition to shattering Kenya’s reputation as a bastion of stability in a region beset by conflicts, the political crisis choked the mainstay tourism and agricultural sectors.

Effectively, The treasury slashed the 2008 growth forecast from 7% to between 4,5% and 6%, with independent economists putting at an average of 4%.

Former UN chief Kofi Annan mediated a power-sharing agreement on February 28, which ended the violence, paving the way for coalition government to be sworn in on April 17 after weeks of bitter negotiations. — AFP