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Ethiopia's inflation numbers make a new turn around in upward direction

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03/13/12

  12:37:16 am, by admin, 491 words  
Categories: Ethiopia

Ethiopia's inflation numbers make a new turn around in upward direction

Ethiopia's inflation numbers make a new turn around in upward direction


By Keffyalew Gebremedhin

The data released this afternoon by the Central Statistics Agency (CSA) indicates that year on year headline inflation rose to 36.3 percent in February 2012, compared to 32.0 percent in January 2012. Food inflation also rose to 47.4 percent from 41.4 percent in January and non-food inflation to 21.4 percent from 19.2 percent in January.

The CSA report indicates that most of the increases in food prices are mainly on cereals, pulses, vegetables, fruits and spices. Therefore, compared with the January 2012 data, the increases in the price of cereals was 23 percent, meat 148 percent, vegetables and fruits 217 percent, foods taken away from home 118 percent and spices by 130 percent.

It is extremely surprising that in a year the government announced a harvest of 218 million quintals of crops, representing 7 percent increases, food inflation should rise so significantly, after declines were observed in the overall rate of inflation in the previous two months.

When Agriculture Minister Tefera Derbew came on Ethiopian television to announce this glad tidings on 16 December, he indicated that this amount surpassed that of last year by 15 million quintals (Ministry foresees 218 million quintals of harvest in the upcoming season).Normally, high inflation in Ethiopia is associated with poor harvests, not in a season of good harvests. Also bear in mind that, CSA Director General Samiya Zekeria was on television days before the minister of agriculture to announce on television the good harvest. His need to reiterate the same story is evidence of how much the government has taken the yields with great satisfaction.

Having gone through the CSA data, my mind went back to February when during his submission of the government’s six-month performance report to parliament on February 8, 2012 Prime Meles Zenawi briefly touched on the success of his policies in promoting growth and curbing inflation.

Amongst the things he referred to, one was the successful implementation of the budget during the first six months of fiscal year 2011/12. Budget deficit was contained at ETB 941 million. In its Historic Deficit article, Addis Fortune noted that this has left many experts scratching their heads for inexplicability of the unexpected shift in the numbers. In other words, inflation was not thought to worsen so soon, when improvements were expected.

At that time, also buoyed by slight improvements in tax collection—in a country of 85 million people where 962 taxpayers pay 70 percent of the taxes, as recently reported in 70% of Tax Revenue in Ethiopia Collected From 962 Taxpayers —the prime minister made references to the improved measures taken in monetary policy, including reduction of borrowings from the central bank, and on the fiscal front with a view to bringing down inflation to single digit within a few months.

Unfortunately, the February 2012 inflation data that came out late by a day only signaled its refusal to give testimony to and support for the prime minister’s claims, as shown by the rise in overall inflation.

*This original of this article is edited for editorial reasons.

http://transformingethiopia.wordpress.com/

5 comments

Comment from: Debebe [Visitor]
Debebe

We, here in Addis are used to this type of news. There is no surprise. This is what we expect, and this is what we are getting under the regime of TPLF. Inflation, and more inflation is the order of the day.
I wonder how many of you diasporas know that Ethiopia’s inflation rate is one of the highest, if not the HIGHEST, in the world?
Please, do not listen to those who tell you to stop sending money to your family. If you stop sending we stop breathing. It is as simple as that.
Don’t ever think Meles and his minority regime will care for us.
Long live Western Union & MoneyGram.

03/13/12 @ 01:01
Comment from: hagosoch wede tigray [Visitor]
hagosoch wede tigray

the uneducated jungle bunnies ‘tigres’ dragging ethiopia into a grave. :(

03/13/12 @ 01:23
Comment from: TEDDY [Visitor]
TEDDY

The only thing that the crime minister can do is only publishing fake statistics while the peoples are starving .AS IF DIGITS CAN FEED PEOPLES !!!!

03/13/12 @ 02:53
Comment from: Agerwedad [Visitor]
Agerwedad

Here is an answer to why the numbers don’t add up; THEY ARE COOKED!

On another note does anyone know who the 962 individuals that pay 70% of the taxes are?? Besides Sheik Al Amoudi that is.

03/13/12 @ 11:15
Comment from: coolman [Visitor]
coolman

OMG,Nazret! Do you guys have to post such a rubbish article? This site is really loosing it and getting worse by the day. Very unfortunate!
Please be serious, please.

Peace

03/13/12 @ 18:37

rebtel

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