Government has now released its first official inflation tables

Government has now released its first official inflation tables since July 2008. I have attached the Consumer Price Increase figures for January and February this year, which show that the Central Statistical Office has chosen to re-base all the figures to December 2008. So all the December figures show 100 as the index and the January and February figures in the attached table show the extent of the US dollar price movements since December.

You will note immediately that most of the prices have fallen since December, indicating an increasing amount of competition between retailers as well as improving efficiency in the procurement of the imported lines that make up most of the retailers' stocks. Now that the 5% surrender of daily turnover has been abolished, which confiscation of funds also applied to wholesalers and manufacturers, the prices should fall further. Many basic food products are now duty free, but the duties ranging between 40% and 60% that applied to most other goods have now been set at a flat 40%, but the additional charges affecting clothing and footwear must be added. For clothing, this has been reduced from US$10 per kg to US$5 per kg, but the additional charge for shoes remains the same at US$5 per pair.

New calculations have been done by the CSO to reintroduce their Poverty Datum Line tables. So far, figures are available only for January. Separate exercises have been done to distinguish between food and other requirements, the food calculations being done on the basis if an intake of 2100 kilo-calories per person. In January, the costs of the required quantities was calculated at a national average of US$35,47 per person per month. Further details show that the prices were lowest for Harare consumers, at US$31,61, and highest at US$40,43 for those in Matabeleland North.

Expenditures per person for the full range of requirements measured, including food, was an average of US110,42. No breakdown of the items in the average consumption spending basket is offered. The tables also show these expenditures for a family of five people, but to arrive at these figures, the CSO has simply multiplied the amounts per person by five. This makes the unrealistic assumption that a family of five will occupy five rooms, use five times as much energy to cook food and all members would need to spend the same amounts on things like clothing and bus fares. The stated requirement of US$552 per family of five seems likely to be well above the average actually being paid, but it seems unlikely that we will receive any detailed guidance on employment numbers and average actual earnings for some time. Statistics of this nature were last published in 2004.

John Robertson