11 November 2012

Ethiopia: A New Day With a New Price Hike - How Long?

The rice in food price is worsening by the day particularly for the low income section of the society. It has become a daily phenomenon to hear individuals fretting about the ever increasing price hike in basic consumer items.

There are even individuals who have given up eating "injera"--(Ethiopian staple food made from Teff) for its price has become dreadfully unfordable.

Nuro Beengurguro, (pseudonym), 35, is a civil servant in one of the government offices in Addis Ababa. He says the daily price hike and price unpredictability, specially that of basic consumer goods, has become unbearable.

Kasahun Bemeru, 31, is also a civil servant working in one of government office here in Addis. "Currently, I am feeling that I'm one of the unfortunate persons in this country. Each day dawns with unreasonable price increase on consumer goods. My salary has become too small to meet my basic demand. For this reason, I am forced to make cuts on my daily meals, from three times to two times a day. The likes of me call this "strategy' 'eleven-five' (you take breakfast at five o'clock local time and dinner at eleven local time). How could a person lead such a desperate life?"

Esu yawkal Adane, 27, is another civil servant whom this reporter approached. Because of the uncontrollably galloping price of red onions, he has decided to stop using it in "Wot" (traditional sauce eaten with injera or bread).

CSA Consumers Price Index show that in Ethiopia food expenditure is the highest. Out of the total Index, the share of food expenditure is 57 per cent and that of non food items is 47 per cent.Therefore, an increase in food items has a direct impact on inflation. In contrast, an increase in the price of non-food items does not have that much impact.

According to Ministry of Trade Public Relation and Communication Affairs Assitant Head, Abdurahman Seid, the ever increasing price hike on basic comdity items is artificial and created by illegal brockers.

"For example, one month before, the price of a kilo of onion was between 14-17 birr. However, currently, this price has dramatically come down to 8-9 birr. This is a demonstration of the fact that intervention of illegal and unethical brockers jeopardize the market system."

As a response to the ever increasing price of consumer goods, the government has been striving to put solution in place through imposing price gap, importing and distributing basic consumption items to consumers.

Abdurahman also said, through providing improved seeds to the farmers the government has planed to increase production and productivity. Modernizing the traditinal market system is also another area of foccus.

The country is aspiring to be a middle income nation within the coming 15 years. Could this be achived without building the low and 'middle class' earners? Life is becoming unbearable to the so called middle income class particularly governemnt employees who are living only on their megear monthly salary.

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