Ethiopia inflation soars to 7.1 percent
ADDIS ABABA (Reuters) – Ethiopia’s year-on-year inflation rose to 7.1 percent in December from 0.6 percent in November on the back of rising fuel, food and construction material prices, the statistics office said on Friday.
Inflation in the vast Horn of Africa nation hit a high of 64.2 percent in July 2008. It then entered a period of deflation from July to October last year.
“In the recent months, except for cereals and oil seeds and fats, all the other food components show a rise in their indices,” the Central Statistical Agency said in a statement.
“Among the non-food components, the prices of fuel, construction materials, clothing and footwear, furniture and furnishing and personal care and effects are increasing.”
After the July 2008 peak, the government halted state borrowing and increased bank reserves to drive down the rate.
Ethiopia’s central bank had also instructed private banks to restrict borrowing as part of the attempts to curb inflation.
The global recession has slashed international demand for Ethiopia’s agricultural exports and power cuts have ravaged business, fuelling a foreign currency shortage.
The government says it expects growth of about 10 percent in 2010. Opposition parties contest the government’s statistics.
Ethiopia, one of Africa’s biggest potential markets with some 80 million people, is drawing growing foreign investor interest in agriculture, hydropower and oil and gas exploration.
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dfabachew
28 Jan 10 at 12:27 am
What is this inflation bla bla. About 80% of the Ethiopian population lives in rural areas of the country. The country has about 500k soldiers which is completely detached from producing any thing. It is a complete parasite. On the top of that the country is blessed with people who work against the interest of the general population of the country, rather they work for the beeteerment of the tigray province. 5mil people are waiting for hand out from the world population, meaning those 5mill farmers produced nothing last year. The country has no GDP. So what is this inflation, deflation stuff. GDP has a barometer–demand and supply. The country has no real economy. Its economy is war economy i.s “tigray tiqdem Ethiopia Twdem”