Friday, February 15, 2008

How long can this go on?

Bobby Mugabe has been drowning his country in a sea of worthless currency for quite some time now. In March of 2006 the official inflation rate hit 900%. It turns out that those were the good old days. By the summer of 07, the inflation rate was had at least tripled from that level, and the IMF was forecasting that it would reach 100,000% in 2008.

It looks like that's at least one forecast the IMF will nail, as inflation surged from over 25,000% in December of 07 to over 66,000% in January of 08 (these are annualized rates).

From the AP report:

Zimbabwe's economy has been on a downturn for the past eight years characterised by galloping inflation and shortages of basic foodstuffs such as sugar and cooking oil.

At least 80 percent of the population is living below the poverty threshold, often skipping meals to stretch their income, which frequently fails to cover basic needs.

The government has introduced several measures to rein in inflation including imposing a ceiling on prices of some goods and services and knocking off three zeros from the country's currency.

The CSO last released the monthly inflation statistics to the media in September last year and the November figure was only released by the central bank chief in a statement last month.

It's amazing how they make it sound like an exogenous event the government is doing its best to fight rather than calling it the deliberate policy of the government, i.e. Mugabe-omics.

It's also amazing how South Africa still seems to be propping up Mugabe. Who do they think they are, us??

1 comment:

John Thacker said...

And they just announced that, yes, it reached 100,000% (annualized) in January.

According to Mugabe, it's all the fault of foreigners.