Ethiopia inflation up in August on food prices

September 14th, 2011 Print Print Email Email

ADDIS ABABA, Sept 13 (Reuters) Ethiopia’s year-on-year inflation jumped to 40.6 percent in August from 39.2 percent a month before as food prices rose, especially for cereals, the statistics office said on Tuesday.

Food prices account for 57 percent of the consumer price index.

“The total price index of cereals in August 2011 has increased by 52.3 percent as compared to the similar month last year which significantly contributed to the rise in the indices of food and the general consumer price index,” the statistics office said in a statement.

“Relative rises were observed in the indices of most of the components of food.”

Inflation has become a major problem across the east and horn of Africa this year, as poor rains have hurt farming while global oil prices have surged. The International Monetary Fund, which expects Ethiopia’s economy to grow 7.5 percent this year, says inflation is the country’s main macroeconomic challenge.

* Inflation pushed higher by rising cereal prices

* High inflation a problem in region (Adds details, background)

  1. bimm
    | #1

    The aEthiopian economy is controlled by the Tigre People Liberation Front’s ,TPLF, economic arm EFFORT. Effectivelly, EFFORT has its fingers stuck in every sector of the economy. It controls the previously state owned industries and businesses which in the name of privatization have been transferred to TPLF /EFFORT ownership.

    They put price controls, regulate supply and demand in the market, regultae the monetary system (income and expenditure), regulate import/export earnings, tax and tariff duties. One can say all duties are in the hand of one person in the TPLF politbureau.

    There is no system in ethiopia where the economy is free and flexible and where market forces and conditions are allowed to operate. It is no wonder therefore hyperinflation is the norm. When the woyane economists observe a price hike what they do blame a few private merchants, threatening them with jail and fines in order to grind down their businesses.

    Every succesful private merchant or trader is seen with suspicion by the TPLF as a rival. Because of this private businesses do not have the opportunity to grow and flourish as they should. In addition to this taxation system is not on the side of the private businesses.

    if you set up a business there is no guarantee that the woyane officials will let you operate freely.

    THE ETHIOPIAN ECONOMY WILL REMAIN IN AN intractable situation as long as the woyane remain.

  2. Sheger
    | #2

    And also vegetable and froots.

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