Muke Ya Muzungu
JF-Expert Member
- Jun 17, 2009
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| Saturday, 27 April 2013 17:29 |
Ordinary wananchi can't afford to stress over whether inflation is in single or double digits – they're already strung out from trying to figure out how to stretch their dwindling incomes just to survive. For many, meat is out, sardines are barely in and life goes on. PHOTO | FILE By Sturmius MtweveThe Citizen Reporter Dar es Salaam. Most Tanzanians have no cause to be happy despite the recent announcement of a decline in inflation to historic single-digit sums.vFor many locals, life is sufficiently hard as is, so most simply have neither the time nor the energy to fret over the latest price polls. Economists say the public's reaction is no surprise, when one considers the fact that price decreases of major commodities are not reflected in real life. While incomes of many Tanzanians have stagnated, the cost of most consumer goods and essential services has not significantly changed as implied by the latest report on the inflation rate. Whether it is in double or single digits, they say, a fall in the rate of inflation makes sense to ordinary peple when it means they have enough disposable incomes -- amounts of incomes left to individuals after taxes have been paid, available for spending and saving. Wananchi can also feel the decline if it enables them to save and invest. "While the inflation rate is low compared to just one year ago, it is still very high. It's still an economic pain to many people. Moreover, people do not simply feel the impact of the current inflation rate," said economics Prof Richard Mshomba. According to him the impact of inflation accumulates over time. According to him, although the National Bureau of Statistics (NBS) does a careful work in calculating the rate of the cost of living, it is also important to note that the "basket" used to calculate inflation is not ideal for everyone. "For example, the basket of goods and services that a ‘typical' consumer could buy for Sh300,000 in just two and a half years ago would now require Sh400,000. Another way of putting it, for someone with a fixed income of Sh300,000, he/she would now be able to only buy 72 per cent of what he/she could buy in January of 2011." Inflation decreased to 9.8 per cent last month for the first time in 21 months, but consumers contend that a comfortable cost of living for most Tanzanians remains elusive with prices for most staple commodities extremely rising The last time it was in single digits was in June 2011 when it stood at 9.7 per cent before it skyrocketed to 19.8 per cent in December 2011, the highest in 15 years. Early this month, NBS reported that consumer prices rose only by 0.5 per cent in March compared with the 1.4 per cent increase the previous month, thus slowing down the year-on-year inflation rate to 9.8 per cent from the February level's 10.4 per cent. It attributed the positive trend to the key indicator of the status of the national economy to steady falling food prices. But it noted that the overall prices of non-food items increased slightly in March. "Even though the country has begun enjoying the single-digit inflation rate, the news does not reflect the pinch the ordinary people are facing. Low inflation rate must be reflected in the cost of essential commodities. The likes of sugar, rice, bread and maize flour are still very expensive to millions of Tanzanians, which is not a good sign," said treasury expert John Mashaka. "Consumers are feeling the impact on their wallets considering the overall low and stagnant wages relative to the cost of living. I therefore do not see a relief to the consumer in relation to the single-digit inflation rate in the country," he bemoaned. A survey by The Citizen on Sunday found that the price of sardines in Dar es Salaam has risen to between Sh3,000 and Sh4,000 a kilo from Sh2,000 - Sh3,000 when inflation was in double digits. Maize flour still fetches between Sh1,200 and Sh1,400 compared with between Sh1100 and Sh1200 previously whereas beans are being sold at between Sh1800 and 2500. The price of rice has, however, decreased considerably with a kilo selling at Sh1,600 in some areas. According to Mr Odilo Majengo of the ministry of Industry, Trade and Marketing, most NBS figures used for calculating inflation come from a group of selected goods that it considers to be basic. "When there are no changes in the prices of the selected goods within a certain time frame that means there is no inflation," he said. However, other commodities or services, which matter in people's lives, are not captured or monitored by the body. Businesswoman Sabrina Makange described the falling in the inflation rate without a decline in the living standards to a mere delusion. Farmer Martin Kihiyo said the single-digit inflation would make sense to them when it leads to reduced costs of production. The 46-year-old, who grows crops in Bagamoyo and at Mabwepande in Dar es Salaam, had expected increases in crop prices could earn him extra money to improve his family's living standard only to see his profits ending into covering the rising costs of agricultural inputs. |