Pain in the pockets as inflation spirals

Forget the jargon of inflation such as base effects, knock-on effects and transitory effects. What ordinary consumers understand is the pain in their pockets. With the average prices of goods and services trending at a nine-year high, Mmegi Staff Writers,

Economists, like any other sub-sector of specialised interest, have their own jargon or technical terms used to describe various indicators in their field. Outsiders may feel the jargon is used to close them out, but those on the inside use it to more accurately describe trends, indicators, phenomena and others. Often, something gets lost and misinterpretation may occur in simplifying jargon.

When the wave of tax, levy and tariff increases were announced in April this year, economists noted that these would result in inflationary pressures, some in terms of knock-on effects, others in terms of transitory effects. With inflation, or the average increase in the prices of goods and services, having trended at record lows last year, averaging just 1.9 percent, economists expected another technical term, ‘base effects’ to come into play this year.

Inflation is currently trending at nine-year highs due to the various ‘effects’, and this week, the trade minister, Mmusi Kgafela warned that the lifting of the State of Emergency (SoE) next week would fuel further inflation, as price controls on essential goods are removed.

For the average consumer, however, the ‘effects’ are felt in the trolley in the pocket after a trip to the supermarket. The pain in the pocket is felt in how higher electricity prices are removing money from consumers’ pockets. How higher fuel prices, rentals and water tariffs are competing in the pocket for the few available pula amid a stubborn pandemic.

Those attempting to build their own homes will have found the prices of building materials, particularly cement, moving beyond reach. Services such as postage and those accessed from the financial sector, have all also risen significantly this year.

Focussing on the supermarket trolley alone, Statistics Botswana figures show that in the past 12 months, the prices of oils and fats, particularly cooking oil, have risen the most, followed by prices of fish. The prices of bread, different types of fresh meat, coffee and teas as well as milk and related products have all risen significantly as well.

This week, a snap survey by a Mmegi news crew in three major supermarkets that pride themselves on low prices, found that the cheapest two-litre bottle of cooking oil ranges from P45 to P51, while a two-kilogramme of White Star maize meal ranges from P27 to P31. A one-kilogramme packet of brown sugar ranges between P13 and P16, while 26 tagless teabags of Five Roses Smooth Ceylon range between P14 and P16.

Other data shows that a two-litre of cooking oil can go as high as P70, while the two kilogrammes of White Star can fetch as much as P40. One kilogramme of brown sugar can reach P22 and the Five Roses Smooth Ceylon can be beyond P20.

In fact, out of all the food items whose prices are monitored by Statistics Botswana, only vegetables have provided some relief for consumers as their prices have risen by only 1.6 percent in the past 12 months.

The Mmegi news crew spoke to ordinary consumers on how they are coping with the ‘effects’.

Olebogeng Patle

“The whole nation is concerned because of these price increases and it’s very painful to see this happening more especially in this difficult time of COVID-19 and job losses.

“It brings so much pain to us because we also have children who expect us to buy them stuff almost every day.

“Our cooking patterns have also changed as we no longer prepare meals as we used to do.

“Now we have to try and save food so that it can last for a month to avoid spending too much.”

“We were shocked to see these new prices and for us who are not even working, how are we going to survive.

“Imagine the price of a cooking oil going up like that! I mean this shows that the government or whoever is responsible for those new prices don’t even care about Batswana at large.

“They want to destroy our families we are going to die of hunger; that’s what they want I believe.

“We are going to see the crime rate going up because already most people have lost their jobs and where are they going to get money to buy food and other important things?