Antoine Kajangwe, the Director General of Trade and Investment at the Ministry of Trade and Industry, has denied the existence of any illicit operators, often referred to as a mafia, within the potato trading value chain, dispelling speculations that such actors are responsible for the recent price surges in the market.
In an episode of "The Long Form" podcast hosted by The New Times on October 2, Kajangwe delved into several topics, including the escalating food prices, ministerial regulations on price stabilisation, and the outlook of the agricultural performance.
In recent weeks, consumers have voiced concerns over significant price hikes in Irish potatoes. According to the latest market survey conducted by the Ministry of Trade and Industry (Minicom), dated September 26, Kinigi grade 2 potatoes were priced at Rwf1,200 per kilogram in Kigali and Rwf785 in the Northern Province.
Potatoes, among other staple foods in Rwanda, continue to experience price increases that impact household budgets. These rising costs can be attributed largely to a decline in domestic food production over the past two years, exacerbated by adverse weather patterns and the effects of climate change. Notably, heavy floods in the Northern Province have negatively impacted potato yields in this region.
Kajangwe explained, "With the rising costs of wheat, maize, and fertilizer, coupled with reduced supplies, families tend to seek alternative food options, with potatoes being one of them. This surge in demand has led to the observed price increases."
In essence, he emphasized that multiple factors contribute to the escalating potato prices, including diminished domestic supply due to poor crop yields and increased demand caused by reduced imports of other commodities.
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Furthermore, Kajangwe highlighted government measures to combat inflation, such as ministerial price guidelines for specific products like rice, maize, and potatoes. These guidelines are established at the beginning of each agricultural season following a thorough assessment of farming and trading by stakeholders. They are subject to revision when deemed necessary at the start of a new season.
Addressing the rumors surrounding the alleged involvement of a potato pricing mafia, Kajangwe refuted such claims, asserting that the ministry closely monitors the value chain, and no such entity exists.
"We maintain a well-monitored supply value chain, particularly for potatoes. Numerous potato farmers aggregate their produce at the cooperative level, where it is subsequently sold to potato collection centers, facilitating more efficient trade. From there, wholesalers purchase the potatoes and distribute them to markets in Kigali and across the country," He said.
He acknowledged that exceptions may occur, where wholesalers procure potatoes directly from farmers or cooperatives, but such practices are discouraged.
Should the agricultural season perform favorably in the coming months, officials anticipate that inflation will average 7.4 percent by the end of 2023, aligning with the central bank's target range of 2 percent to 8 percent. Notably, inflation in August had reached 12.3 percent.
