Zimbabwe's inflation hits one million percent

Zimbabwe's inflation hits one million percent

Zimbabwe’s inflation has passed the one million percent barrier, according to independent figures today.

Finance houses said that annual inflation rose this month to 1,063,572% based on prices of a basket of basic foodstuffs.

As stores opened for business today, a small pack of locally produced coffee beans cost just short of 1 billion Zimbabwe dollars. A decade ago, that sum would have bought 60 new cars.

A loaf of bread cost 200 million Zimbabwe dollars – enough for 12 new cars a decade ago. Fresh price rises were expected after the state Grain Marketing Board announced up to 25-fold increases in its prices to commercial millers for wheat and the corn meal staple.

The collapsing economy was a major concern of voters who dealt President Robert Mugabe a defeat in March 29 elections. His challenger, Morgan Tsvangirai, topped the poll but did not win the simple majority needed to avoid a runoff. The two face each other in a second round June 27.

Mugabe was to officially launch his runoff campaign with a rally at his party’s headquarters in Harare on Sunday, the state-run Herald newspaper reported Wednesday.

The opposition’s campaigning has been hampered by violence blamed on Mugabe’s government and party. The opposition claims Mr Tsvangirai is the target of a government assassination plot and he has been out of Zimbabwe since shortly after the March 29 first round.

He plans to return to Zimbabwe to campaign for the runoff once security measures are in place, his aides have said.

The economy was on shop assistant Jessica Rukuni’s mind as she left the public swimming pool in Harare’s central park with three disappointed children.

She found the new admission price of 100 million Zimbabwe dollars – 30 US cents (15p) – out of reach.

“The point is that it’s far too much for most people who don’t get US dollars,” she said.

The divorcee’s income is the equivalent of about one US dollar a day. Her family has one basic meal a day.

One kilogram of chicken more than doubled to 1 billion local dollars yesterday and rental for a two-bedroom apartment rose from this month’s end to 22 billion Zimbabwe dollars – eight times the May price.

The state Rent Board, where unfair or inflated rental hikes are reported, has had no working telephones for several months, a telephone operator at the Ministry of Housing said.

In the economic meltdown, manufacturing industries, running at below 30% of their capacity, reported growing absenteeism by workers facing soaring commuter bus fares.

Economic analysts say unless the rate of inflation is slowed, annual inflation will likely reach about five million percent by October.

Zimbabwe’s official annual inflation was given by the government as 165,000% in February, already by far the highest in the world.

The government has not updated that – the state statistical service has said there were not enough goods in the shortage-stricken shops to calculate new figures.

Already, more transactions are being done in US dollars, both openly and in secret.

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