Zimbabwe’s inflation breaks 3-digit barrier again, worst in a year

HARARE – Zimbabwe’s annual inflation jumped to 131 percent in May – the highest it has been since June last year – as it responds to the massive devaluation of the local currency and runaway price increases.

Annual inflation stood at 96.4 percent in April before the return to triple-digit inflation. Month-on-month inflation was 8.7 percent in May from 9.6 in April, the Zimbabwe National Statistics Agency said on Wednesday.

The last time Zimbabwe had triple digit inflation was Jun 2021 when it stood at 106.6 percent.

Zimbabwe’s finance minister Mthuli Ncube has projected the economy to grow 5.5 percent and inflation to end the year at around 35 percent, but analysts say the numbers are too optimistic.

Rampant price increases and a more than 50 percent depreciation of the local currency in the last month will step up pressure on President Emmerson Mnangagwa who blames the economic crisis on “saboteurs” and deflects criticism of his government.

Labour unions are demanding salary increases after watching their pay being shrivelled by the high cost of living.

The opposition says President Mnangagwa has no plan to tame the developing economic crisis.

“It’s a complete disaster, it’s a dog’s breakfast,” former finance minister and opposition Citizens Coalition for Change deputy leader Tendai Biti said.

Questioning inflation figures put out by the government agency ZimStat, Biti referred to an International Monetary Fund report on Zimbabwe released on April 8 last month.

“The IMF says our inflation in 2020 was 837 percent. The IMF also says our economy shrunk by 11.7 percent in 2020 and uses the words ‘Zimbabwe has been a deep recession’,” Biti said.

“Now, what’s happening in 2022 is nothing compared to 2020. Things are terrible. Fuel, cooking oil, sugar, meat – just about everything has gone up. Prices are raping our people and I reckon in the last two weeks alone inflation has gone above 80 percent. Now, once you have month-on-month inflation of 80 percent, then you have hyperinflation.”

Bit said if Zimbabwe’s inflation was 837 percent in 2020, “in 2022 it’s going to be 1,000 and once you reach that level you’re in no-man’s territory, you’re back to 2008.”

Biti’s CCC party has urged the government to scrap the Zimbabwe dollar which was re-introduced in 2019 and dollarise, but the government maintains that this is option is not o the table.

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