Malawi inflation second highest in Comesa
Malawi’s annual inflation rate in the month of October 2013 was the second highest in the Common Market for Eastern and Southern Africa (Comesa) regional bloc, a latest Comesa Harmonised Consumer Price Index (HCPI) has indicated.
Malawi inflation at 20.5 percent, according to the update, trailed Sudan inflation which recorded the highest year on year inflation rate of 32.3 percent whereas the Democratic Republic of Congo recorded the lowest inflation rate of 1.7 percent in October 2013.
Using the kwacha currency, based on the Comesa HCPI, it means an item that cost an average of K100 in October 2012 increased to K120.50 in October 2013.
The revelation by the Comesa report, seen by Business Review, comes barely few days after the National Statistical Office (NSO) reported that the country’s year on year headline inflation rate for the month of October 2013 stands at 22.2 percent, a 0.5 percentage point increase from a rate of 21.7 percent recorded in the month of September, 2013.
Reacting to the Comesa inflation update on Tuesday, a Lilongwe based financial expert said the fact that Malawi inflation is second in Comesa, should be a wake-up call that there is need for monetary authorities to intensify tight monetary policy implementation to contain increases in the prices of goods and services.
Said the expert: “What it means is that prices of goods and services in Malawi are increasing at a faster pace than in most countries within Comesa. This has a negative impact on the welfare of Malawians especially low income earners who are seeing their purchasing power lowering.”
According to the Comesa update, as measured by the latest HCPI, the Comesa region year on year inflation rate stood at 10.3 percent in October 2013.
Using a particular or common currency, an item that cost an average of 100 cents in October 2012 increased to 110.30 cents in October 2013.
According to the Comesa report, based on the main components of expenditure, the restaurants and hotels division registered the highest annual inflation rate of 21.7 percent whilst the housing, water, electricity, gas and other fuels recorded the lowest annual inflation rate of -3.9 percent in October 2013.
The Comesa HCPI comprises 12 expenditure divisions which include food and non-alcoholic beverages, alcoholic beverages and tobacco, housing, water and electricity, furnishings, household equipment, transport and communication, restaurants and hotels, among others.
It says of the 12 main components of expenditure, the transport division recorded the highest month on month inflation rate of 10.1 percent whist the food and non alcoholic beverages and foot wear and clothing recorded an average increase of 2.3 percent in October 2013.
Other rates include, Burundi (6.7 percent) , Democratic Republic of Congo (1.7 percent) , Egypt (8.1 percent) , Ethiopia (8.0 percent) , Kenya (6.8 percent), Madagascar (7.2 percent), Mauritius (5.0 percent) , Rwanda (5.6 percent) , Seychelles (4.7 percent), Swaziland (2.5 percent) , Uganda (9.0 percent), Zambia (9.7 percent) , and Zimbabwe (2.5 percent).
The Comesa HCPIs are produced by the Comesa secretariat in collaboration with the member states with the aim of measuring inflation in similar ways and can therefore be compared directly with each other without the need for making special adjustments.
