Government unable to calculate inflation due to shortages

By Tererai Karimakwenda
28 November, 2007

The government’s chief statistician, Moffat Nyoni, has said the inflation figures that are issued at the beginning of each month will be delayed, because the basic items used to measure them are not available in the shops. Known as the “average family basket” there are specific basic goods needed by each family every month, and the cost of these items from month to month is used to calculate the rate of inflation.
Nyoni’s admission shows just how severe the shortages have become, and also confirms how the government’s insistence on price controls is destroying the economy.

The state Herald quoted Nyoni as saying: "There are too many data gaps," and he was "now trying to find ways of coming up with the missing figures." The last official figure for inflation, reported last month, was 7,982%. However economic experts say the actual figure is closer to 15,000%. The inflation rate is expected to more than triple by the end of the year.

A resident of Mabelreign suburb Harare laughed when asked whether there was any meat in the shops, “asi wabva kudenga?” She asked if we had dropped from the sky. Her answer was that she had not even seen any meat since July.

Choosing to remain anonymous the woman said she has to walk to the nearest TM or OK Supermarket because there are none open in her area. She managed to find some fresh milk on Tuesday and she bought two 500 ml packages at Z$1, 350,000 each. One medium size tomato costs her a shocking Z$200,000.

The government’s price controls have made it impossible for companies to even cover their costs, so it’s impossible to re-order any goods. Back in June businesses were ordered to cut their prices by about half, forcing them to operate at a loss. This has left the shelves in shops empty and created a black market for goods where the prices are extremely high. If these prices were used to calculate inflation, the result would be more than 100,000%.